FirstCry IPO subscribed 12.2 times; Unicommerce issue booked 167.5 times

Despite sharp volatility in the equity market amid U.S. recession concerns and unwinding of Yen carry trades following a rate hike by the Bank of Japan (BoJ), investors’ demand for IPOs remained strong. Overwhelming responses to the initial public offerings (IPOs) of new-age companies FirstCry and Unicommerce eSolutions demonstrate that there is continued investor appetite for equity in quality businesses despite tighter liquidity. The three-day IPO of Brainbees Solutions, the parent of FirstCry, was subscribed 12.2 times on the final day, while the issue of Unicommerce closed with 167.5 times bidding. The tentative date for listing of shares of FirstCry and Unicommerce on the BSE and NSE is August 13.

Earlier this week, electric vehicle (EV) player Ola Electric raised ₹6,146 crore in the country’s second largest IPO after the LIC of India's ₹21,000 crore, which was subscribed 4.27 times. Besides, the ₹1,253-crore issue of infrastructure construction firm Ceigall India was booked 13.75 times.

FirstCry IPO gained momentum on Day 3

The IPO of SoftBank-backed e-commerce unicorn garnered strong response on the final day, with the issue subscribing 12.2 times, after getting lukewarm response in the first two days (0.11 times on Day 1 and 0.30 times of Day 2).

The ₹4,193.73 crore issue of Brainbees Solutions, the parent of FirstCry, received bids of 60,32,17,440 shares worth ₹28,049 crore against the offered 4,96,39,004 equity shares, according to the data available on the stock exchanges.

As per the exchange data, the retail portion was subscribed 2.14 times, while the quota reserved for non-institutional investors (NIIs) was booked 4.55 times. The portion set aside for qualified institutional buyers (QIBs) received 19.30 times bids, while the employee quota was subscribed 6.32 times. The company had reserved 75% of the issue for QIB, 15% for NII, and the remaining 10% for retail investors.

Founded in 2010, the country’s biggest retailer in the mother and childcare segment offered shares at a price band of ₹440-465 per share and lot size of 32 shares. The issue comprised fresh equities worth ₹1,666 crore and an offer for sale (OFS) of up to 5.2 crore shares worth ₹2,527.73 crore.

Out of a fresh issue size of ₹1,666 crore, FirstCry proposes to use ₹388 crore for investment in its Indian subsidiary, Digital Age, which was acquired on May 2, 2022. The fund will be utilised for setting up new modern stores under the FirstCry brand and other home brands as well as lease payments for its existing identified modern stores owned and controlled by Digital Age.

Meanwhile, ₹173 crore will be invested in its subsidiary, Globalbees Brands, for acquiring additional stake in the step-down subsidiaries. The company will invest another ₹150 crore on sales and marketing initiatives and ₹57.6 crore in technology and data science costs.

Unicommerce IPO subscribed 167 times

The ₹276 crore IPO of the country’s largest e-commerce enablement Software-as-a-Service (SaaS) platform received overwhelming response from investors, with the issue receiving 167 times bids. The issue received bids of 2,35,55,39,112 shares worth ₹25,440 crore against the offered 2,23,13,663 equity shares, at a price band of ₹102-108 per equity share, according to the data available on the stock exchanges.

The NII portion received maximum bid with 251.71 times subscription, while quota reserved for QIB was booked 138.75 times. The portion set aside for retail investors was booked 126.01 times. The MD and CEO Kapil Makhija-led company had reserved 75% of the issue for QIB, 15% for NII, and  remaining 35% for retail investors.

The IPO of Unicommerce is completely an offer for sale of 2.56 crore shares by selling shareholders. As it is entirely an OFS, the IPO proceeds will go to shareholders offloading their stakes.

Established in 2012, Unicommerce caters to the Indian e-commerce industry, which is experiencing phenomenal growth and is projected to reach $350 billion by 2030. It empowers brands, retailers, marketplaces, and logistics providers with a comprehensive suite of SaaS solutions for end-to-end e-commerce management. The company’s impressive client list includes leading names like Lenskart, Fabindia, Zivame, TCNS, Mamaearth, Emami, Sugar, BoAt, and many more.