Honest Consumer Ltd., the parent company behind well-known direct-to-consumer brands like MamaEarth, The Derma Co., and BBlunt, has gained approval from the Securities and Exchange Board of India (SEBI) for its initial public offering (IPO). This development is especially positive given that several startups have faced challenges in either postponing their IPO plans or encountering difficulties in obtaining regulatory approval.

The approval for MamaEarth’s parent company’s IPO comes after it filed it’s Draft Red Herring Prospectus (DRHP) with SEBI in December of the previous year. While there were reports in March suggesting a potential delay in the listing plan, the company, led by Ghazal and Varun Alagh, refuted such claims. The IPO proposal involves a combination of fresh funds amounting to Rs 400 crore and an offer to sell up to 46,819,635 equity shares held by existing investors.

According to the DRHP, the founders jointly hold a 43.54% stake in the company, while notable stakeholders such as Peak XV Partners (formerly Sequoia Capital), Fireside Ventures, and Stellaris possess 20.94%, 15.01%, and 11.24% stakes, respectively. MamaEarth stands out as one of the few profitable companies with imminent IPOs in the last couple of years.

Although the company’s financial figures for FY23 have yet to be filed, it reported operating revenue of Rs 722 crore during the first half of FY23 (H1 FY23). In the previous fiscal year, FY22, MamaEarth experienced a twofold growth in scale, reaching Rs 943 crore in revenue, while its profits saw a 50.3% decrease to Rs 14.4 crore.