Wakefit Innovations, India’s largest D2C home furnishings firm, plans to challenge Swedish affordable-furniture retailer Ikea in domestic market, leveraging on its backward-integration edge.
The firm on Tuesday set a price band at Rs 185-195 for its Rs 1,288-crore initial public offering (IPO).
“We will open jumbo stores showcasing home furnishings within the next eighteen months,” said Ankit Garg, co-founder and CEO of Wakefit, in an exclusive interview. “Ikea is the closest competitor in this segment. Three stores will initially be opened in Bangalore and then in other cities.”
Wakefit offers home solutions across mattresses, furniture and furnishings.
Wakefit to open alongside Meesho
Consumer-sector IPOs are in vogue, after Urban Company’s float received more than 100 times bids. Wakefit IPO opens alongside e-commerce unicorn Meesho, among the first few in about two dozen issuances anticipated in December. Both Meesho and Wakefit are backed by global venture fund Peak XV.
At the upper end of the price band, Peak XV’s 22.47% stake in Wakefit is valued at Rs 1,368 crore. This is around 850% rise from the invested amount. Peak had exited brokerage Groww and fintech Pine Labs with astounding returns, in November.
The VC major is “likely to stay invested (in Wakefit) at least for the next two years, given the large stake it owns,” said Garg.
The furnishing vertical resembles fashion industry in terms of design, color and seasonality, said the founders. It takes several years for “a Western-trend to come to India. We bring it instantly,” they said. The firm has complete grip on its supply chain.
Bidding window to remain open till Dec 10
The IPO bidding window will remain open from December 8 to 10. Axis Capital, IIFL Capital and Nomura Financial are the book runners (BRLMs). Investors expressed mixed views on the December IPOs rush even as foreign investors (FPIs) continue to rotate capital from secondary to primary markets this year.
“While sentiments are positive for the markets, the abundant supply in primary markets has slowed the rise in secondary market,” said Sunil Singhania, founder of Abakkus Asset that manages Rs 40,000 crore in alternates.