About Urban Company Limited - Mainboard IPO
Urban Company Limited is a technology-driven online services marketplace based in Gurugram, India, specializing in connecting customers with trained professionals for home and beauty services. Founded in December 2014 as UrbanClap, the company was renamed Urban Company and has become India’s leading full-stack home services platform. The company operates across 51 cities globally, including 48 in India and 11 in international markets such as UAE, Singapore, and Saudi Arabia, offering services like cleaning, plumbing, pest control, beauty treatments, appliance repair, and wellness services. Urban Company also manufactures products like water purifiers and electronic door locks under its Native brand.
READ DRHP HERE: SEBI|DRHP|URBAN COMPANY|
IPO Details
| Key Points | Information |
|---|---|
| IPO Price Band | ₹98 – ₹103 per share |
| Minimum Lot Size | 145 shares (about ₹14,935 at highest price) |
| Issue Size | ₹1,900 crore (₹472 crore fresh + ₹1,428 crore OFS) |
| Face Value | ₹1 per share |
| Stock Exchanges | BSE and NSE (NSE Mainboard IPO, BSE Mainboard IPO) |
| Registrar | MUFG Intime India Private Limited CLICK HERE |
| Book-running Managers | Kotak Mahindra Capital, Morgan Stanley India, Goldman Sachs India, JM Financial |
| Offer Structure | QIB - up to 50%, Retail - up to 35%, NII - up to 15% |
IPO Timeline
| Event | Date |
|---|---|
| IPO Opens | 10th September 2025 |
| IPO Closes | 12th September 2025 |
| Allotment Date | 15th September 2025 |
| Refunds/Unsuccessful Bids | 16th September 2025 |
| Shares in Demat Account | 16th September 2025 |
| Listing Date | 17th September 2025 |
What Is the Money Used For?
The funds raised will be used mainly for:
- Funding capital expenditure for new technology development and cloud infrastructure (₹190 crore).
- Funding lease payments for offices (₹75 crore).
- Marketing and brand promotion activities (₹90 crore).
- General corporate purposes.
Key Financials (as per RHP and Public Prospectus)
Urban Company IPO Financial Performance (FY23-FY25)
| Financial Metric | FY23 (₹ Cr) | FY24 (₹ Cr) | FY25 (₹ Cr) |
|---|---|---|---|
| Revenue | 637 | 828 | 1,144 |
| Profit After Tax (PAT) | -312 | -93 | 240 |
| EBITDA (Profit from Operations) | -364 | -147 | -32 |
| EBITDA Margin | -57.2% | -17.7% | -2.8% |
| Adjusted EBITDA | -298 | -119 | 12 |
| Adjusted EBITDA Margin | -46.8% | -14.4% | 1.1% |
| PAT Margin | -49.1% | -11.2% | 20.9% |
| Return on Equity (ROE) | -23.3% | -7.2% | 13.4% |
| ROCE | -22.8% | -6.5% | 2.7% |
| Earnings Per Share (EPS) | ₹1.66 (FY25 Basic) |
Explanation of Financial Terms:
- Revenue: Total sales made from business
- EBITDA: Profits before interest, taxes, and certain costs
- PAT (Profit After Tax): Final profit after all expenses
- ROE/ROCE: How well the company uses investor money
- EPS: Profit for each share
Analysis
- The company’s revenue has shown strong growth - from ₹637 crore in FY23 to ₹1,144 crore in FY25, a 79% increase over two years.
- Urban Company achieved a remarkable turnaround from losses to profits - from ₹312 crore loss in FY23 to ₹240 crore profit in FY25.
- EBITDA has consistently improved, moving closer to breakeven with adjusted EBITDA turning positive at ₹12 crore in FY25.
- The company’s profitability was significantly aided by ₹211 crore deferred tax credit recognition in FY25.
Why Some Investors Like This Mainboard IPO
- The company is the leading player in India’s organized home services market with strong brand recognition
- Strong network effects with 6.8 million annual transacting customers and 97 million service orders completed
- Platform connects 47,888 active service professionals monthly, with professionals earning 15-20% more than peers in food delivery
- Diversified revenue streams including services (73.4%) and products (26.6%) through Native brand
Points That Need Caution
- The company has a history of significant losses with negative EBITDA margins until recent improvement
- High valuation at nearly ₹15,000 crore market cap with expensive pricing multiples
- Heavy dependence on technology platforms and digital visibility for customer acquisition
- Employee costs remain high at 28.6% of total expenditure
- Intense competition from traditional offline players and other online platforms
Industry Position
Urban Company operates in the rapidly growing Indian home services market. The global online on-demand home services market is projected to grow at 16.7% CAGR from 2022 to 2030. Despite no direct listed peers in India, the company competes with both organized and unorganized players in a market estimated at over $30 billion in India. The company’s first-mover advantage in organized tech-enabled home services, combined with its scale and brand strength, positions it well in this fragmented market.
IPO FAQS
What is an IPO?
- An IPO (Initial Public Offering) is when a private company sells its shares to the public for the first time to raise money.
- Example: If a well-known pizza company wants to grow, it can list its shares on the stock exchange so anyone can buy a piece of the company.
How can you apply for an IPO (using Zerodha or Upstox)?
- Make sure you have a Demat account and your bank account is linked.
- Steps:
- Log in to your broker’s app (e.g., Zerodha Kite, Upstox).
- Go to the IPO section.
- Select the company’s IPO you want to apply for.
- Enter how many shares (or ‘lots’) you want and the price you wish to bid.
- Enter your UPI ID, submit your application, and approve the UPI payment request.
How are IPO shares allotted?
- If more people want shares than are available, the company uses a lottery system to decide who gets them.
- If you don’t get shares, your money is simply returned.
What is GMP (Grey Market Premium)?
- GMP shows the extra price people are willing to pay for IPO shares before they officially start trading.
- Example: If IPO price is ₹100 and GMP is ₹20, people are unofficially ready to pay ₹120. It hints at the IPO’s popularity but isn’t a guarantee.
Where to check upcoming IPOs (IPO calendar)?
- Visit popular finance sites like Chittorgarh, IPOWatch, or official exchange websites (NSE, BSE) and look for the “Upcoming IPO” section.
What are IPO listing gains?
- If the share’s price rises on the first trading day, you can make instant profit.
- Example: You buy at ₹150, and it opens at ₹200, you gain ₹50 per share.
How can you make profit from an IPO?
- Quick gains on listing day (if the stock price goes up).
- Long-term: If the company grows, the share price could increase further.
Which IPO is best to buy?
- There is no single best IPO. Check the company’s background, current demand, and GMP, but always research before investing.
- High GMP or popularity doesn’t guarantee profits.
Are IPOs safe?
- IPOs can be profitable but also risky; prices can go up or down sharply.
- Only invest if you are ready for potential losses.
How to check IPO allotment status?
- After the IPO process, check on exchanges (BSE/NSE websites) or the IPO registrar’s site (like K-Fintech, Bigshare,or mufg-intime) by entering your PAN or application number to see if you got shares.
Important Tips for Retail Investors Applying for an IPO
- Use Only Your Own PAN Card:
Avoid using the same PAN card for multiple IPO applications. For example, if you have already applied using your PAN for one IPO, don’t try to apply again with the same PAN under different accounts or through others. - Apply in the Right Category:
Ensure you select the correct investor category (such as Retail Individual Investor) when filling out your application. Applying under a wrong category can lead to rejection or disqualification. - Maintain Sufficient Bank Balance:
Before applying, ensure your bank account linked to the application has enough funds to cover the full bid amount. For instance, if the IPO application requires a payment of ₹15000, make sure your account holds at least that amount. - Use Your Own Bank Account:
Always apply through your own bank account. Using someone else’s account can cause your application to be rejected during the verification process. - Avoid Last-Minute Applications:
Don’t wait until the deadline day or moments before to apply. Last-minute submissions may face technical glitches or processing delays, reducing the chances of success.