Popees Baby Care India Plans Rs 511 Crore Share-Swap Deal to Acquire Promoter-Linked Baby Products Business

Popees Baby Care India Ltd has approved the acquisition of 99.31 per cent of Popees Baby Care Products Ltd through a share-swap arrangement valued at Rs 511.33 crore, positioning the unlisted target’s baby-products operations as the listed company’s primary business.

The board approved the Share Subscription and Share Purchase Agreement on October 8, 2026. Instead of a cash payout, Popees Baby Care India will issue up to 2,60,44,323 equity shares and up to 98,53,471 fully convertible warrants to shareholders of Popees Baby Care Products at an issue price of Rs 142.44 per security.

The transaction is sizeable relative to Popees Baby Care India’s existing reported operations. The listed company recorded standalone revenue of Rs 2.60 crore in FY26, when its income came entirely from trading in ready-made garments and textiles. In comparison, Popees Baby Care Products reported turnover of Rs 161.93 crore for FY26, up from Rs 135.30 crore in FY25, and generated Rs 45.82 crore in the quarter ended June 30, 2026.

This means the acquisition would bring into the listed platform a business with FY26 turnover of more than 62 times that of Popees Baby Care India’s standalone FY26 revenue. The stated consideration is also about 3.2 times the target company’s FY26 turnover, although profitability and other valuation metrics of the target were not disclosed in the announcement.

Popees Baby Care Products is engaged in manufacturing, trading, wholesale and retail of baby products, including garment items and fashion apparel. Popees Baby Care India said the deal would allow it to use the target’s business capabilities and operational infrastructure while pursuing diversification, expansion and operational synergies.

The proposed equity issue, involving 199 investors, is scheduled for FY27. The warrant issue to 83 investors is proposed for FY28, with warrants convertible into equity shares within 18 months of allotment.

Shaju Thomas, who is a common promoter and is chairman and managing director of Popees Baby Care India, is proposed to receive 1,38,27,465 equity shares and 73,40,546 warrants. Linta Purayidathil Jose, also a common promoter, is proposed to receive 27,32,516 equity shares and 7,88,455 warrants.

Following the equity allotment, Shaju Thomas’s holding is indicated at 51.69 per cent and Linta Purayidathil Jose’s at 11.84 per cent. After conversion of the warrants, their holdings would rise to 56.75 per cent and 10.99 per cent, respectively. The company said the holdings of its existing promoters would consolidate to 69.63 per cent after approval of the share swap.

The acquisition also formalises a pre-existing commercial relationship between the two entities. In its FY26 annual report, Popees Baby Care India disclosed purchases of Rs 2.36 crore from Popees Baby Care Products, describing the transactions as being on an arm’s-length basis and in the ordinary course of business.

The preferential issue price was determined after considering valuation reports from IBBI-registered valuers CA Karan C. Shah and CA Bhavesh M. Rathod. The relevant date for the issue has been fixed as October 19, 2026. The proposal requires shareholder approval and other regulatory clearances, with completion indicated within 15 days of stock exchange approval.

Separately, the board approved an increase in authorised share capital to Rs 47 crore from Rs 10.25 crore, subject to shareholder consent. The expanded capital base is necessary to accommodate the proposed equity and warrant issuance.

As of 9:55 a.m. on October 9, 2026, Popees Baby Care India shares were trading at Rs 153.90, down 5 per cent from the previous close of Rs 162.00. The stock was about 26 per cent below its 52-week high of Rs 208.15 and around 17 per cent above its 52-week low of Rs 131.35. The issue price of Rs 142.44 represents a discount of about 7.5 per cent to the prevailing market price.

Disclaimer: The article is for informational purposes only and not investment advice.