Boat Raises Rs 500 Cr To Expand In Smart Watches, Withdraws IPO Plans

Imagine Marketing (parent company of boAt), announces its plans to fuel the expansion of its business given strong operating momentum across its categories. The company is raising Rs 500 crore from its existing shareholder, an affiliate of Warburg Pincus, a leading global private equity fund and new investor Malabar Investments. 

Earlier this year, Imagine Marketing, the parent company of boAt filed a Draft Red Herring Prospectus (DRHP) with SEBI on 26 January 2022 for an IPO of Rs. 2,000 crore. This offer includes a 900 crores fresh issue of equity shares and an offer for sale amounting to Rs. 1,100 crores as described in the DRHP. 

 According to the reports, it was approved for boAt to raise INR 180 crore prior to the IPO but the company has raised more than Rs 500 crore of equity so it proactively withdrew its DRHP. The audio gear and wearables brand is now likely to launch IPO (Initial Public Offering) in the next 12-18 months period. 

The investment will enable the company to accelerate its plans to attain leadership in the smartwatches category, scale up its business across channels and geographies (both within and outside India), further strengthen its category leadership within audio, enhance its R&D and design capabilities, and support building a local manufacturing ecosystem under the Make-in-India initiative. 

Aman Gupta, Co-founder and Chief Marketing Officer, of boAt, said “We have established clear leadership in our core personal audio category and are the number two player globally in earwear. It is a matter of great pride that a brand that was born in India is now ranked amongst the top brands in the world. We now want to make smartwatches our second core and will replicate the boAt digital playbook to become global leaders in this category as well. The new funding will allow us to invest significantly to disrupt the smart watches spaces with more innovative products. And we are thrilled that investors continue to have strong conviction and confidence in the boAt story”. 

Partnerships with leading global companies like Qualcomm (also a shareholder in boAt), Dolby, Dirac, and others have helped in bringing the best technology to consumers.

Sameer Mehta, Co-founder and Chief Product Officer, of boAt, added: “We are very excited about the potential of smartwatches. The market today is in the early stages of evolution and most players don’t have control over the end-to-end stack to offer compelling features to consumers. There is a significant opportunity to build the category and launch more distinctive and technologically advanced products. Through boAt labs (our 120-person in-house R&D team) and our acquisition of KaHa Technologies, (a world-class wearables technology and IoT platform, with 64 patents and patent applications), we are developing the next generation of products. These products will provide richer features and deeper insights to consumers on their health and wellness to enable them to lead more active and fulfilling lifestyles”.

The strong operating momentum these investments have created has resulted in boAt having built significant scale (it closed FY (March) 2022 with net revenue of approximately Rs 3,000 crore), industry-leading revenue growth (~100 per cent ) year on year while building a profitable business and investing for the future.