From promoter to customer: FirstCry's dual role in Swara Baby Products' ₹1,000-crore IPO

Every IPO has a story beyond the financial numbers. In Swara Baby Products' case, the ₹1,000-crore public issue also tells the story of how Brainbees Solutions, the parent company of FirstCry, gradually transformed from a strategic investor into the company's promoter while continuing to be one of its largest customers.

The proposed IPO comprises a fresh issue of ₹500 crore and an offer for sale of another ₹500 crore. The fresh capital will largely be used to build a new manufacturing facility in Madhya Pradesh, repay debt, support subsidiaries and pursue acquisitions, as per the IPO papers filed with the Sebi.

Swara began operations in 2016 under the leadership of founder and managing director Alok Birla as a relatively small baby diaper manufacturer based in Madhya Pradesh. Four years later, in 2020, Brainbees Solutions entered the company as a strategic investor by subscribing to compulsorily convertible preference shares and purchasing a minority equity stake at ₹52.92 per share. The investment aligned with FirstCry's broader effort to strengthen its private-label product portfolio.

Brainbees significantly increased its exposure in April 2023 by acquiring a large stake from existing promoter entities at ₹305.71 per share. It deepened its ownership further in March 2025 through another share purchase from Anadya Bon Merchari LLP at ₹603.32 per share, nearly twice the valuation of the 2023 transaction.

Following the conversion of its preference shares into equity in December 2025, Brainbees formally assumed promoter status. According to Swara Baby Products' draft red herring prospectus (DRHP), Brainbees currently holds 76.59% of the company, while Alok Birla retains a stake of about 1.4%.

The proposed IPO will allow Brainbees to partially monetise its investment through an offer for sale amounting to ₹300 crore.

More than a shareholder

Brainbees' importance doesn't end with ownership. It is also Swara's largest customer.

Swara manufactures BabyHug diapers and other private-label hygiene products sold through FirstCry. According to the DRHP, Brainbees contributed 27.03% of Swara's revenue in FY24, 23.45% in FY25 and 22.64% in FY26. In simple terms, nearly one out of every four rupees Swara earns comes from its own promoter.

This relationship has clear advantages. It provides Swara with steady order flow, manufacturing scale and long-term demand visibility. For FirstCry, it ensures better control over product quality, supply and pricing for one of its most important private-label brands.

Building scale in a growing market

India's hygiene products market continues to expand rapidly as disposable incomes rise, urbanisation increases and consumers shift towards organised brands. According to the TKC Report cited in the DRHP, the addressable market for baby diapers, adult diapers and sanitary napkins was valued at ₹23,090 crore in FY25 and is expected to reach ₹42,100 crore by FY30.

Swara has spent the past few years preparing for that opportunity. From a single production line in 2018, it now operates four manufacturing facilities across Pithampur and Indore with 20 automated manufacturing lines spread over 24 acres.

Its annual capacity has grown to around 266 crore baby diapers, 25.3 crore adult diapers and period panties, and 75.6 crore sanitary napkins and panty liners.

The company also expanded through acquisitions in late 2025, buying KAEHPL, which manufactures sanitary napkins and panty liners, and Solis Hygiene, an adult diaper manufacturer. Those deals have helped Swara build a presence across the entire hygiene products spectrum.

For FY26, Swara reported revenue of ₹1,212.44 crore, up 26% from the previous year, while profit after tax rose 18% to ₹95.59 crore. EBITDA increased to ₹192.77 crore.

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