Brainbees Solutions, parent of omnichannel retailer FirstCry, has filed its draft red herring prospectus (DRHP) to raise ₹1,816 crore issuing fresh shares and an offer for sale of more than 54 million shares.

The Pune-headquartered firm will use the new capital for setting up new stores and warehouses. It will also use the new capital for international expansion. The company, which was last valued at under $3 billion in the private market, is likely to float its public issue at a valuation of around $4 billion.

Offloading of shares

Existing investors Masayoshi Son-led SoftBank Vision Fund, Premji Invest, Mahindra Retail and TPG Growth, among others, will be offloading part of their holding in FirstCry, while all four co-founders of FirstCry will be offloading a part of their stakes to new investors through the offer for sale, which means the money won’t go to the company coffers.

Ratan Tata will sell nearly 78,000 shares as well. SoftBank will be selling another 2 crore shares; Mahindra Retail 28 lakh shares; and Premji Invest will offload 86 lakh shares, the filings showed.

SoftBank and Premji Invest currently own 25.5 per cent and 10.36 per cent of FirstCry, respectively. SoftBank is the only investor with more than 15 per cent stake in the company.

The co-founder and chief executive Supam Maheshwari has also diluted his holding in parts. According to the DRHP, he held about 8.15 per cent in the ecommerce firm about a year ago, which has now come down to 6 per cent. The remaining co-founders — Sanket Hattimattur, Amitava Saha and Prashant Jadhav — own 0.58 per cent, 2 per cent and 1.44 per cent in the start-up, respectively.

E-commerce unicorn FirstCry saw its revenue from operations jump to ₹5,633 crore in FY23 from ₹2,401 crore in FY22, as the company gears up for public market listing. The company saw its net loss widen from ₹79 crore in FY22 to ₹486 crore in FY23, according to filings sourced via data intelligence company Tofler.

The company’s total expenses surged to ₹6,316 crore in FY23 from ₹2,568 crore in FY22 , on the back of higher employee-related expenses, finance costs and other expenses, including procurement costs.