Published: 05th Aug 2024

FirstCry IPO: The Good and the Bad

By: Value Research

About the company

FirstCry, owned by Brainbees Solutions, is India’s largest multi-channel retail platform (by gross merchandise value) that primarily sells child care products like clothing, toys, diapers, skincare & baby food etc.

Total IPO size (Rs cr) 4,194 Offer for sale (Rs cr) 2,528 Fresh issue (Rs cr) 1,666 Price band (Rs) 440 - 465 Subscription dates August 6 to August 8, 2024 Purpose of issue To fund capital expenditure and working capital requirements

FirstCry IPO details

M-cap (Rs cr) 24,142 Net worth (Rs cr) 4,837 Promoter holding (%) - Price/earnings ratio (P/E) - Price/book ratio (P/B) 5

Post-IPO

Key financials 2Y growth pa (%) FY24 FY23 FY22   Revenue (Rs cr) 64.3 6481 5633 2401   EBIT (Rs cr) - -300 -612 -129   PAT (Rs cr) - -274 -441 -72   Net worth (Rs cr) 3171 3456 3528   Total Debt 1423 899 409

Financial history

PAT is profit after tax EBIT is earnings before interest and tax

3Y average FY24 FY23 FY22   ROE (%) -7.6 -8.3 -12.6 -2   ROCE (%) -7 -5.8 -12.5 -2.7   EBIT margin (%) -7 -4.6 -10.9 -5.4   Debt-to-equity 0.4 0.3 0.1Ratios

Key ratios

ROE is return on equity ROCE is return on capital employed

The Good

With a strong brand recall and a solid rapport with parents (customers), the company has cornered the highest market share of 16-17% in the organised child care retail market.

The Good

It touts a robust & integrated supply chain of 80 warehouses, 567 distributors and over 1,312 sub-distributors that enable same day deliveries in 45 cities and next-day deliveries in 1,043 cities.

The Bad

High goodwill and a streak of losses has plagued the company. Why? Rapid inorganic growth. Read about its weaknesses and risks in our full story. Click the link below.