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Ghazal Alagh Denies IPO Valuation Speculations

Mamaearth's parent company, Honasa Consumer, filed the draft red hiring prospectus (DHRP) with Security Exchange Board of India (SEBI) last December

Ghazal Alagh Denies IPO Valuation Speculations
POSTED ON January 05, 2023 9:48 AM

Direct-to-consumer (D2C) wellness brand Mamaearth’s co-founder Ghazal Alagh denied all the speculations related to its initial public offer (IPO) valuation. The ex-Shark of the popular reality show Shark Tank India, said that the company has neither quoted nor subscribed to the figures. 

Alagh wrote on her Linkedin profile, “Valuation discovery is a process which will take place over time as we get into deeper conversations with the investor community.”

Earlier, people took to Twitter to raise questions about the IPO plans of the company. A chartered account wrote, “Even if it is assumed that funding of Rs 400 crore will take the profits of the company to Rs 240 crore and assuming 100% profit to be given as dividend and the startup grows further at an inflation rate, it will take a poor investor 100 years (Valuation Rs 24,000 crore) to recover his money.”

Honasa Consumer Limited, the parent company of Mamaearth, filed the draft red hiring prospectus (DHRP) with the regulatory body Security Exchange Board of India (SEBI) for an IPO in December 2022. The offer will issue shares worth Rs 400 crore, with an offer-for-sale (OFS) component of 46.82 million shares. 

For the OFS, founders Varun and Ghazal Alagh and investors including Sofiana, Fireside Ventures, Evolvence India and Stellaris are expected to dilute their shareholding in the company. Additionally, angel investors including Kunal Bahl, Risabh Mariwala, Rohit Bansal and Shilpa Shetty Kundra will reduce their shareholding. 

According to an Economic Times (ET) report, the company reported Rs 722.73 crore from April to September 2022 in revenues. It also registered a profit of Rs 19.8 crore in the financial year (FY) of 2022. 

In January 2022, the company raised $52 million from Sequoia Capital at a valuation of $1.2 billion. With the funding, it stepped into the club of Indian unicorns. 
 

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