Wakefit files IPO documents. Promoters, investors Peak XV, Verlinvest and Investcorp to offload stake

Wakefit Innovations Ltd, a home and furnishings company, has submitted plans for an initial public offering to the market regulator, seeking to raise ₹468.2 crore to more than double its store count.

Apart from the issue of fresh shares, the company will offer to sell up to 58.4 million shares held by the current owners, including its founders and major private equity investors, according to the draft red herring prospectus filed with the Securities and Exchange Board of India.

As part of the offer for sale, Wakefit’s promoters Ankit Garg and Chaitanya Ramalingegowda will sell 7.73 million and 4.45 million shares, respectively. The top institutional investors selling shares are likely to make multi-fold returns in the IPO.

Peak XV is selling 25.06 million shares, which it acquired at a weighted average cost of ₹20.52 apiece. Investcorp funds, selling 6.18 million shares combined, bought them at ₹85-88 each, and Verlinvest S.A., selling 10.19 million shares, purchased them for ₹82.67 each.

Paramark KB Fund I is selling 3.06 million shares, SAI Global India Fund is selling 830,000 shares, individual Nitika Goel is selling 720,000 shares and Redwood Trust is selling 170,000 shares.

Founded in 2016, Wakefit sells mattresses, beds, sofas, and home furnishings under its flagship brand, largely through its own website and app. It has expanded sales to a mix of e-commerce, experience centres, and company owned and operated stores.

The company had raised multiple rounds of capital from these marquee investors from 2018 to 2023. In the latest round in January 2023, Wakefit raised ₹320 crore from investors led by Investcorp, with participation from existing investors, Sequoia Capital India, Verlinvest, and SIG.

The company also plans to raise a pre-IPO funding round aggregating up to ₹93.6 crore, according to the draft prospectus.

Wakefit appointed Axis Capital, IIFL Securities, and Nomura as book-running lead managers for the issue.

New outlets

Of the ₹468.2 crore that it plans to raise from the IPO, Wakefit will invest ₹82.1 crore to open 118 new outlets, ₹145.2 crore towards lease payments for existing stores, and ₹15.4 crore on equipment. It will also spend ₹108.4 crore on advertising and brand marketing, it said.

The company had 98 stores as of December 2024. It plans to open its first large store, called a Jumbo store, in Bengaluru soon.

Wakefit is the latest direct-to-consumer company joining the IPO queue, following in the footsteps of Honasa Consumer (Mamaearth), with Lenskart, Licious, and boAt expected to tap the public markets soon.

The company recorded income of ₹994.3 crore and a net loss of ₹8.8 crore in the first nine months of FY25, according to the draft prospectus. Wakefit reported total income of ₹1,017.3 crore in FY24, up from ₹820 crore in the previous fiscal, while its net loss narrowed to ₹15.05 crore from ₹145.68 crore in FY23.