Did you know THIS about FirstCry IPO | CA Rachana Ranade

Summary

CA Rachana's IPO summary video introduces Brainbees Solutions Limited, known for its retail platform First Cry, India's largest for mothers, babies, and kids. The company operates multi-channelly, with a significant online presence and physical stores. The video discusses the company's target audience, product range, and the potential of the child care industry in India, which is growing with a young population. It also covers the financials, risks, and objectives of the IPO, advising investors to consider both the company's fundamentals and the current market sentiment.

Takeaways

• 😀 Brainbees Solutions Limited, known for its brand First Cry, is India's largest multi-channel retailing platform for mothers, babies, and kids products.
• 🛒 First Cry operates through various channels including online sales, company-owned stores, franchise-owned stores, and general trade retail.
• 👶 The primary target audience for First Cry is mothers, babies, and kids, offering a wide range of products such as baby clothes, toys, strollers, car seats, and maternity wear.
• 📈 Childcare is considered a non-discretionary essential expense, making parents perpetual customers and potentially allowing for predictable cash flows from parents.
• 🌍 India has a large and young population with approximately 30.6 CR children under the age of 12, making it a significant market for children's products.
• 💼 The apparel segment is the largest in the children's market, accounting for almost 68% of the total market as of 2024.
• 📊 The Indian children's market is estimated to grow at a CAGR of 12-14% and is expected to grow at 13-15% between 2024 and 2029.
• 💰 Indian parents spend an average of around 9,000 to 9,300 per child per year, which is significantly lower compared to other countries like China, Saudi Arabia, UAE, UK, and the US.
• 🏢 First Cry's revenue is primarily from its India multi-channel segment, which accounts for about 70% of its total revenue, with international sales contributing 11.63%.
• 🔑 Global Bees Brand, a part of First Cry, covers key categories like home utilities, fashion, lifestyle, appliances, and beauty and personal care, contributing 18.66% to the company's revenue.
• ⚠️ Key risks for First Cry include material uncertainties for certain subsidiaries regarding their ability to continue as a going concern and the company's history of incurring losses which may continue in the future.

Q & A

What is the main topic of the video?

The main topic of the video is an IPO summary of Brainbees Solutions Limited, which operates under the brand name First Cry, India's largest multi-channel retailing platform for mothers, babies, and kids products.

What is the significance of the term 'multi-channel retailing platform' in the context of First Cry?

The term 'multi-channel retailing platform' refers to the various ways First Cry sells its products, including online, through company-owned stores, franchise-owned stores, and general trade retail.

What types of products does First Cry offer to its customers?

First Cry offers a wide range of products for mothers, babies, and kids, including baby clothes, toys, strollers, car seats, maternity wear, and many more.

Why is child care considered a non-discretionary essential expense?

Child care is considered a non-discretionary essential expense because it is a necessary expenditure for parents to meet the basic needs of their children, which is a continuous requirement due to the rapid growth and changing needs of children.

How does the demographic of India contribute to the potential growth of the child care industry?

India's demographic, being among the youngest nations in the world with a median age of approximately 28 years as of 2023 and a large population of children under the age of 12, contributes to the potential growth of the child care industry as it indicates a large target audience for such products and services.

What is the estimated growth rate of the overall market for child care products in India?

The overall market for child care products in India is estimated to grow at a CAGR of 12 to 14%, with an expected growth rate of 13 to 15% between the years 2024 to 2029.

How does the spending of Indian parents on their children compare to parents in other countries?

On average, an Indian couple spends around 9,000 to 9,300 per child per year, which is significantly less compared to parents in countries like China (around 45,000), Saudi Arabia (around 61,000), and the UAE, UK, and US (around 2,10,000), indicating a large headroom for growth in India.

What are the main business segments for First Cry's revenue?

First Cry's main business segments for revenue include India multi-channel, which accounts for almost 70% of their revenue, international markets contributing 11.63%, and Global Bees Brand accounting for 18.66% of their revenue.

What is the meaning of 'going concern' in the context of a company's financial health?

A 'going concern' refers to the ability of a company to continue operating for the foreseeable future, typically at least one year. If a company's auditors express doubts about its ability to continue as a going concern, it indicates potential financial instability.

What are some of the key risks mentioned in the RHP (Red Herring Prospectus) for First Cry?

Some key risks mentioned in the RHP include material uncertainties about certain subsidiaries' ability to continue as a going concern, the company's history of incurring losses which may continue in the future, and pending litigations against the company and its subsidiaries.

What is the purpose of the funds raised through the IPO according to First Cry's RHP?

The funds raised through the IPO will be used for a variety of purposes as detailed in the RHP, including opening new stores, setting up warehouses, lease payments for modern stores, investment in subsidiaries, and funding organic growth.

What is the time frame for the IPO of First Cry as mentioned in the video?

The IPO of First Cry is scheduled to open on the 6th of August and close on the 8th of August.

How does the video suggest evaluating the decision to invest in an IPO?

The video suggests evaluating the decision to invest in an IPO by considering the company's financials, the business model, the risks, the industry, and the overall market condition, which can significantly impact the IPO's reception regardless of the company's merits.