Beauty Garage Limited IPO

01At a glance

What the company does: sells salon-grade shampoos, conditioners, styling products, scalp care and hair treatments under the Beauty Garage name and ranges such as K9, Botoliss and Shea (AP p.3).

Who pays it: salons, reached through distributors, and consumers online; its products are in more than 13,044 salons in 272 cities, including Lakmé Salons, Enrich, Toni & Guy and Bounce (AP p.4). The ten largest customers, mostly distributors, were 78.27% of FY26 revenue (DRHP p.28).

Why it is raising money: ₹911.57 million towards a manufacturing facility at Vasai, and the rest for general purposes (DRHP p.108).

How fast it has grown: revenue from ₹510 million in FY24 to ₹969 million in FY26, and profit from ₹88 million to ₹316 million (AP p.10).

The one thing to understand: very high margins on a small, concentrated base. EBITDA margin was 43.33% in FY26, but one distributor, Lucky Enterprises, accounted for 18.77% of revenue, and the business relies on imports and outside suppliers for materials and semi-finished products (AP p.11, DRHP p.27, DRHP p.28, DRHP p.30).

02The business, in plain words

A professional hair-care brand develops formulas, has them made or makes them, and sells to salons, which use them in treatments and resell them to clients. Brand reputation among stylists drives demand; gross margins are high, and much of the cost is marketing and distribution.

A salon wants a keratin or smoothing treatment → it orders Beauty Garage products through a distributor → it uses them on clients and sells retail packs → Beauty Garage earns a high margin on each unit.

The founders started the brand in 2019 through a partnership firm, MJ Trading, and incorporated the company in 2021 (AP p.3). Products are also sold on e-commerce platforms and the company's own website (AP p.3).

Earnings equation: Profit ≈ units × gross margin − marketing − distribution. Gross margin was 73.38% in FY26 (AP p.11).

03Where the money comes from

Source: DRHP p.28. Shares are of gross revenue before post-sale price adjustments.

Source: AP p.10, AP p.11.

The top ten customers were 62.53%, 80.90% and 78.27% of revenue over FY24 to FY26 (DRHP p.28). The company says a limited number of products provide much of revenue (DRHP p.36).

04The growth record

Source: AP p.10, AP p.11.

Our arithmetic: revenue compounded about 37.8% a year from FY24 to FY26 and profit after tax about 89.3% (AP p.10). The industry report cited in the document puts working-capital days at 271.82 in FY24, 292.66 in FY25 and 260.90 in FY26 (DRHP p.198).

05What the growth is made of

Revenue rose 60.98% in FY26 after 18.02% in FY25 (AP p.11). New products launched in FY26 brought ₹134.73 million in their first year (AP p.10). Online sales nearly tripled over two years (AP p.10). EBITDA margin rose 16 points in two years with only a small change in gross margin, so operating costs fell sharply as a share of revenue (AP p.11).

06Earnings quality

Revenue is reported net of a provision for post-sale price adjustments: gross sales of ₹1,045.02 million in FY26 were reduced by ₹75.74 million (DRHP p.28). The industry has high product-return rates through distribution, which the document lists as a risk (DRHP p.40). Operating cash flow was ₹134.57 million in FY26 against profit of ₹316.20 million (AP p.10). The document reports past delays or non-payment by customers (DRHP p.42).

07The balance sheet

Source: AP p.10.

The company has no debt (AP p.10). Share capital rose from ₹1.50 million to ₹180 million in FY26 (AP p.10).

08What the money is for

Source: DRHP p.108, AP p.1.

The Vasai facility is estimated to cost ₹1,063.52 million, of which ₹151.95 million had been spent; spending from the proceeds is planned over FY27 to FY29 (DRHP p.108).

09Who is selling

Source: AP p.1.

10Promoters

The promoters are Jigar Babubhai Ravaria, Mahesh Babubhai Ravaria and Bharti Mahesh Ravaria (AP p.9). Litigation is pending involving the company and its promoters (DRHP p.34). Promoters, promoter-group members and senior managers hold or have held interests in other businesses, which the document lists as a risk (DRHP p.38).

11Who already owns it

Source: AP p.9. The last row is our arithmetic.

12What changed just before the IPO

• Margins: EBITDA margin rose from 33% to 43% in FY26 (AP p.11).

• Share capital: raised from ₹1.50 million to ₹180 million (AP p.10).

• Manufacturing: work began on the Vasai facility, with ₹151.95 million spent (DRHP p.108).

• Public company: converted from a private limited company in September 2025 (DRHP p.439).

• Bonus issues: 119 shares for every one held in June 2025, and five for every four held in May 2026 (DRHP p.93).

• Remuneration: related-party remuneration was ₹48.13 million in FY24, ₹15.04 million in FY25 and ₹18.40 million in FY26 (DRHP p.82).

• Auditors: no change of statutory auditor in the three years before the filing (DRHP p.87).

13Capacity and expansion

The strategy is to move towards fully in-house manufacturing, with the Vasai facility as the main step (AP p.6, DRHP p.108). The company currently relies on third-party suppliers for raw materials, packaging and semi-finished products, and imports a significant share (DRHP p.27, DRHP p.30). It also mentions international expansion as a strategy (DRHP p.46).

14Market size and industry structure

The industry report cited in the offer document says hair care is one of the largest segments of India's beauty and personal-care market, with a 23.5% share in FY25 (AP p.7).

15Competitive position

What the document claims, and what it rests on:

• One of few Indian premium brands with an end-to-end professional hair-care range (AP p.6).
• A salon network of more than 13,044 salons (AP p.4).
• In-house R&D for new products (AP p.3, AP p.6).

Against that: a few distributors carry most sales, and the document describes competition as intense (DRHP p.28, DRHP p.44).

16Peers the company named

The peer comparison was not read in detail for this study. For Beauty Garage the document gives FY26 earnings per share of ₹7.81, net asset value per share of ₹13.74 and return on net worth of 55.04% (AP p.10). No P/E is possible for the company until a price band is set.

17Risks, in plain words

• Distributor concentration. Five distributors took over half of FY26 revenue (DRHP p.28).
• Suppliers and imports. Materials and semi-finished products come from third parties, many imported (DRHP p.27, DRHP p.30).
• Returns and price adjustments. High return rates and post-sale price provisions (DRHP p.28, DRHP p.40).
• Few products. A limited number of products earn much of the revenue (DRHP p.36).
• New factory. The Vasai project must be built and filled (DRHP p.50).
• Social-media dependence. Marketing leans heavily on social media (DRHP p.39).

18Litigation and regulatory matters

The document reports outstanding legal proceedings involving the company and its promoters (DRHP p.34). The detail was not read for this study.

19Related-party transactions

The company has related-party transactions and expects to continue them (DRHP p.41). The brand began in the promoters' partnership firm, MJ Trading (AP p.3).

20What the offer document does not say

In the sections read for this study, the document does not give:

• Whether the large distributors are related to the promoters.
• What drove the ₹75.74 million post-sale price adjustment in FY26.
• The share of imports in purchases, in the pages read.
• The Vasai facility's capacity and expected start date.
• The price band, lot size or issue dates, which is normal at DRHP stage.

21Five questions for management

1. Why did the top five distributors grow from 47% to 59% of revenue in two years?
2. What were the FY26 post-sale price adjustments for, and are they recurring?
3. How much will in-house manufacturing at Vasai change gross margin?
4. What was the return rate on products in FY26?
5. What is the relationship between MJ Trading and the company today?

2Sources and cited facts

This study was read from 2 documents the company filed. The 65 figures it cites are listed under the document each came from, with the page and the sentence as printed.