Imagine Marketing Limited, the parent of Indian consumer electronics direct to consumer firm BoAt, has filed DRHP with SEBI for an IPO of 2000 crores.
The company was established in 2016 and is backed by investors such as Fireside Ventures, Qualcomm Ventures LLC, and South Lake Investment Limited.
In this IPO of Rs 2000 crores, there is a fresh issue of Rs 900 crores and there is an offer for sale of 1100 crores.
In the OFS of 1100 crores, South Lake Investment limited will sell shares worth 800 crores, and the same founders Aman Gupta and Sameer Mehta will also sell shares worth 150 crores each (total 300 crores).
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The company’s founders Sameer Mehta and Aman Gupta both currently own a 28.26% stake each.
The BoAt has established a leading market position in the high growth consumer category such as audio and wearable. In 2021, 96.01% of the company’s total revenue came from the audio category and 3.99% from the other category.
At the same time, the revenue contribution of the wearable segment has reduced from 14.05% in 2019 to almost negligible in 2021.
The maturity portion of the company’s sales comes from online marketplaces such as e-commerce platforms and BoAt’s own website. The online marketplace accounted for 85.84% of the company’s total sales in 2021.
A continuous upward trend is being seen in the company’s finances. The company’s revenue from operation increased from Rs 609 crore in 2020 to more than double in 2021 to Rs 1313.7 crore.
Interestingly, in the 6 months period from April to September 2021, the company’s revenue was Rs 1547 crore. Net profit has also increased very rapidly and from April to September 2021, the company has recorded a net profit of 118.3 crores.
The company’s EBITDA margin was 11.08% during the same period as against 6.26% in 2019.
The company mentioned its risk and said that the online marketplace is a risk heavily on external contract manufacturers and third-party suppliers.
Apart from this, the potential geopolitical tension between India and China can also affect the business of the company. The company will use the raised fund through this IPO to repay its debt.