Female hygiene brand Soothe Healthcare Pvt. Ltd on Thursday said it raised ₹175 crore ($21 million) in a bridge round from the US government’s Development Finance Corporation (DFC) and existing investors.
The company raised ₹120 crore in equity from A91 Partners, Symphony International Holdings Ltd, Sixth Sense Ventures and Gulf Islamic Investments (GII) while US DFC invested ₹55 crore in debt. Advisory firm Intellecap was the exclusive transaction advisor between US DFC and Soothe Healthcare.
Soothe Healthcare plans to use the funds to expand its distribution channels and deepen its reach to women across tier II and III markets. The capital will also be used to amplify marketing outreach and spread a wider social message on women’s menstrual hygiene.
Founded in 2016, Soothe Healthcare sells Paree sanitary pads, Super Cute’s baby diapers and Super Life adult diapers through 250,000 outlets in India and online retailers.
Most of the sales generate from retail stores from tier 2 cities and beyond, said Sahil Dharia, chief executive and founder in an interview. He said the company plans to stay focused on selling its products through retail stores.
In FY22, Soothe Healthcare doubled its revenue to ₹200 crore. The company is likely to close this financial year with a more than 30% growth in revenue to about ₹265 crore, said Dharia.
Sanitary pads and baby diapers comprise about 55% and 35% of revenue respectively. Adult diapers, hair removal creams and other products contribute the rest.
Dharia said the company plans to use the fresh funds to strengthen its marketing efforts in a bid to deepen its presence in its existing markets this year.
In August 2021, the company raised ₹230 crore in its Series C round from Incred, GII and Northern Arc along with A91 Partners.
Soothe Healthcare employs about 1,400 people, of which nearly 40% are women. The company manufactures its healthcare products in a factory in Noida.
With low percolation of feminine hygiene products in tier II-III cities and rural areas, this market is projected to grow at an annualized rate of 14.7% through 2022-2027 in India, as per a research report by Mordor Intelligence. It was valued at about $ 896.75 million in 2021, according to the report.
While operating in a market largely captured by big players including Proctor & Gamble and Johnson & Johnson, Soothe Healthcare also competes against companies such as Ahmedabad-based Saathi, Pee Safe and Chennai-based Plush.