Brainbees Solutions shares tumble 10% to record low after weak Q3; stock now 47% below IPO price

Shares of Brainbees Solutions, the company that operates baby and mother care products retailer FirstCry, came under severe selling pressure in Monday's session, February 16, falling sharply by 10% to a fresh record low of ₹244 apiece as investors appeared disappointed with the company's December quarter performance. The company’s net losses widened in Q3FY2, coming in at ₹39 crore as compared to a net loss of ₹15 crore in the year-ago quarter, impacted by higher operating costs, increased discounting, and single-digit revenue growth in its key India multi-channel business segment. Its revenue from operations during the reporting quarter came in at ₹2,424 crore, higher than ₹2,172 crore in the year-ago period, marking a growth of 12%. Across its business segments, India multi-channel (IMC) posted revenue growth of 9% year-on-year (YoY), impacted by heightened competitive intensity in the diapering category and procurement issues in 3P consumables brands. International revenue growth also stumbled at 7% YoY amid elevated promotional activity by horizontal players. GlobalBees, meanwhile, remained stable, with revenue growing 22% YoY, though core categories sustained a stronger 30% growth, according to domestic brokerage firm JM Financial. The brokerage also said that higher discounting in IMC and a drag from non-core GlobalBees brands have impacted gross margins, which declined by 220 basis points YoY to 34.8%. Taking the December quarter results into account, the brokerage lowered GMV and revenue estimates for IMC by 1–4% over FY26–29E. JM Financial built in slower expansion in the IMC and International segments, even as management believes that margins will improve going ahead, led by structural improvement in GM. “We have also lowered our valuation multiples for IMC and International due to higher uncertainty. We now value IMC, GlobalBees, and others at 27.5x, 20x, and 15x FY28E Pre-Ind AS Adj. EBITDA (vs. 30x, 20x, and 15x earlier), while the International segment multiple is lowered to 1x FY28E sales (vs. 1.5x earlier), resulting in a reduced March 27 price target of ₹390 (vs. ₹460 earlier). Even as the brokerage lowered its target price, it maintained its 'buy' rating on the stock, considering the attractive valuation, but expects any sustained recovery in the stock price only after growth improves. Brainbees Solutions shares now down over 45% from IPO price Brainbees Solutions stock has been witnessing severe battering on Dalal Street, as it closed lower in each of the last five months and lost a cumulative 34%. This has pushed the counter to trade 47.5% below its IPO price of ₹465 and 67% below its record peak of ₹734 per share. The sustained crash has further deepened the losses of retail investors, who collectively held 67% of the company's stake as of the December quarter (Q3FY26), according to Trendlyne data. Disclaimer: This story is for educational purposes only. The views and recommendations made above are those of individual analysts or broking companies, and not of Mint. We advise investors to check with certified experts before making any investment decisions.