Urban Company Submits Draft Papers for ₹1,900 Crore IPO Launch

Urban Company, the popular mobile app-based platform for beauty and home services, has filed its Draft Red Herring Prospectus (DRHP) with the Securities and Exchange Board of India (SEBI) to launch an initial public offering (IPO) worth ₹1,900 crore. The IPO filing marks a significant milestone for the startup as it seeks to tap into public markets to fuel its future growth.

Fundraising Details: Fresh Issue and Offer for Sale

According to the DRHP, Urban Company plans to raise ₹429 crore through the issue of new shares. In addition to the fresh equity offering, existing investors are set to divest shares worth ₹1,471 crore through an Offer for Sale (OFS). This dual structure of new issue and OFS is common among high-growth startups looking to balance raising fresh capital while providing an exit to early investors.

Key Investors Participating in the Offer for Sale

Several prominent investors are participating in the Offer for Sale. The list includes:

• Accel India and Elevation Capital

• Bessemer India Capital Holdings II Ltd

• Internet Fund V Pte. Ltd

• VYC11 Ltd

These investors will offload part of their stake in Urban Company, capitalizing on the company's growing valuation and business expansion.

Utilization of IPO Proceeds

Urban Company has outlined a clear plan for utilizing the proceeds from the fresh issue:

• ₹190 crore will be allocated towards the development of new technologies and upgrading cloud infrastructure.

• ₹70 crore will be used to cover lease payments for office spaces.

• ₹80 crore is earmarked for marketing and brand promotion activities.

• The remaining balance will be reserved for general corporate purposes, including working capital and other business needs.

This planned use of funds indicates Urban Company's focus on strengthening its technological capabilities, expanding its physical presence, and enhancing brand visibility.

Urban Company's Business Model and Market Presence

Urban Company operates a technology-driven, full-stack online marketplace that connects customers with professional services in both the beauty and home care sectors. The company prides itself on offering quality-driven solutions, facilitated through a seamless mobile application experience.

As of December 31, 2024, Urban Company had established its presence across 59 cities, including:

• 48 cities in India

• 11 cities internationally in the United Arab Emirates, Singapore, and the Kingdom of Saudi Arabia.

The platform offers a wide range of services such as:

• Home cleaning

• Pest control

• Electrical and plumbing repairs

• Carpentry

• Appliance servicing and repairs

• Painting

• Skincare treatments

• Hair grooming

• Massage therapy

All services are delivered by a network of trained, independent service professionals, ensuring convenience and quality for consumers.

Lead Managers for the IPO

Urban Company has appointed four major financial institutions as the book-running lead managers for its IPO:

• Kotak Mahindra Capital Company

• Morgan Stanley India Company

• Goldman Sachs (India) Securities

• JM Financial

These firms will oversee the IPO process, helping the company to attract both domestic and international investors.

Urban Company’s Growth Story and Future Outlook

Founded with the mission to organize and professionalize the fragmented services industry, Urban Company has emerged as a leader in its segment. Its technology-first approach, coupled with its emphasis on quality and customer satisfaction, has driven strong growth in India and abroad.

The upcoming IPO is expected to further strengthen Urban Company’s position by enabling investments in innovation, scaling operations, and expanding into new geographies. If the IPO is successful, Urban Company will join the growing list of Indian startups making a mark in the public markets.