MUMBAI
:
Livspace, a new-age home interiors solutions provider backed by private equity firm KKR, is planning to shift its domicile back to India, and list on local stock exchanges. Currently based in Singapore, the firm has initiated internal processes with the aim to go public in 2025, three people in the know of the development said.
The company is looking to hit profitability by the end of the current financial year and is eyeing a listing opportunity in 2025, one of the three people cited above said, seeking anonymity.
In February 2022, Livspace raised $180 million in a funding round led by KKR at a valuation of $1.2 billion, to join the coveted unicorn club. The startup has so far raised about $450 million.
“It has begun work internally and is likely to apply for regulatory approvals and flip back the company in the next 9-12 months,” the second person said.
Livspace joins a long list of startups that domiciled overseas with the hope of targeting global pools of capital, but want to now flip back to India. This move is fuelled by the dynamic and robust nature of the domestic equity capital market. Other startups considering a pivot to India includes PhonePe, Razorpay, PineLabs and Groww among others.
“A majority of these companies feel, their story will be best understood in a market where they have established a customer base. Valuations too have improved domestically,” the second person added.
Livspace, founded in 2014 by Ramakant Sharma and Anuj Srivastava, is an omni-channel home interiors and renovation platform with operations across Southeast Asia, India and the Middle East.
Driven by a cash reserve of over $100 million on its balance sheet, it is actively pursuing inorganic growth through strategic acquisitions, which will facilitate its entry into private labels and niche categories. “Our investments are in line with creating a comprehensive ecosystem in the home interiors and renovation sector and to be closer to our customers while delivering a complete spectrum of services,” said Ankit Shah, the chief strategy officer of Livspace in an emailed response.
“In terms of acquisitions, we are looking at only buying companies which are significantly value accretive. This means, we are in conversations with companies that are significantly profitable, have a strong growth trajectory, are well capitalized and have strong management teams.”
Shah, however, refused to share details of the company’s listing plans.
The firm achieved a top-line growth of 85% across its diverse businesses, reporting revenue of nearly ₹1,100 crore in FY23, on the back of strategic expansions, enhancing its supply chain and investments in branding and experience centres, Mint had reported in September.
Its earnings before interest, taxes, depreciation and amortization margin, excluding employee stock options, narrowed from -95.2% in FY22 to -50.7% in FY23, resulting in an Ebitda loss before Esops of about ₹581 crore, compared to around ₹600 crore in FY22. The firm is looking to break-even by the end of FY24. “We are most excited about the private label space, within which we are looking at growing assets with a strong balance sheet and adequate capital,” Shah said.
“We are not at this stage focused on buying distribution assets- given that we are the dominant player in this category and feel we can continue serving a broader set of customers through extensions of our market leading brand,” he added to clarify rumours about its plans to acquire another vertical home interior solutions provider.
“We are extremely excited about building and creating a high growth and sustainable business with a strong focus on profitability and are doing everything internally to get the company ready for any potential outcomes,” Shah added.
In India, the company competes with a large part of the market that is unorganized and in organized sector it is pitted against HomeLane, Design Studio among others.