VC-backed BharatMatrimony.com refiles for IPO
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Online marriage services provider Matrimony.com Pvt. Ltd said on Monday it has refiled its draft red herring prospectus with the Securities and Exchange Board of India for an initial public offering.

The development comes five months after the Chennai-based company, which owns the Bharatmatrimony.com website and affiliated portals, had scrapped its IPO plans citing weak market conditions.

Stock markets have rebounded this year. Last week, benchmark equity indices surged to record highs replicating the mood in global markets. Most companies that have floated an IPO this year, including stock-exchange operator BSE Ltd, hypermarket chain operator Avenue Supermarts Ltd and publishing firm S Chand & Co, have received strong investor response to their share sales.

Matrimony.com plans to raise Rs 130 crore via a fresh issue of shares under the revised plan compared with Rs 350 crore planned earlier. It has increased the number of shares being offloaded by promoters, including founder and CEO Murugavel Janakiraman, and its venture capital investors to 3.76 million shares from 1.66 million shares.

The total size of the IPO has been trimmed to roughly Rs 500 crore ($78 million), according to people familiar with the development.

The company was earlier looking at an IPO worth Rs 550 crore, of which around Rs 200 crore was to go to its selling shareholders. Based on the last disclosed shareholding structure, Matrimony.com was looking at a valuation of around Rs 2,900-3,000 crore, according to VCCircle estimates. It may now be looking at a lower valuation of about Rs 2,500-2,600 crore.

There has been some change also in the offer for sale of shares by some of its VC investors. Earlier, Draper Investment and HartenBaum Trust (associated with a founding investor in Skype, Howard Hartenbaum) were looking to sell most of their stakes while JPMorgan Partners, which had acquired Canaan Partners’ stake in Matrimony.com, and Mayfield had not offered to sell any shares.

Now, Draper Investment and HartenBaum Trust are not among the selling shareholders but global venture capital firm Mayfied will sell 155,760 shares and JPMorgan will sell 1.68 million shares, or one-third of its holding in the company.

The plan of the US-based venture capital and growth capital investor Bessemer Venture Partners to sell its entire stake in Matrimony.com remains unchanged. It had invested in the company nearly six years ago and will sell 1.46 million shares, representing a 6.87% stake on a pre-offer basis.

The company also has a new set of merchant bankers to manage the IPO; it has appointed ICICI Securities and Axis Capital as lead managers. The company was earlier being advised by Kotak Investment Banking, Citigroup Global Markets and Deutsche Equities India.

Matrimony.com was earlier aiming to launch its IPO last November. However, market volatility arising due to a host of domestic and global factors—including the government’s ban on old high-value banknotes—led to a change in opinion on valuations. It had approval till 18 December 2016 to launch an IPO. A company gets one year to float an IPO from the date of receiving SEBI approval.

According to its revised DRHP, Matrimony’s consolidated revenue from operations grew nearly 15% in 2016-17 to Rs 292.82 crore from Rs 254.82 crore the year before and Rs 241.41 crore in 2014-15.

Its operating profit rose to Rs 59.2 crore for the year ended March 2017 from Rs 7.23 crore in the previous year and Rs 17.80 crore for the year ended March 2015, according to the revised DRHP.

Matrimony.com was founded in 1997 and started offering online matchmaking services in 2001. Apart from the website, it also has the mobile-only relationship app Matchify.

There are no directly comparable publicly listed firms for BharatMatrimony. While Info Edge India Ltd, which runs Naukri.com and JeevanSaathi.com, a competitor to BharatMatrimony, is a listed firm, its valuation is dictated more by its job portal and its stake in food-tech firm Zomato.

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