FirstCry-backed hygiene manufacturer plans new Madhya Pradesh facility as it expands baby diaper, adult incontinence and feminine hygiene capacity

Swara Baby Products, an Indian contract manufacturer of disposable hygiene products backed by FirstCry parent Brainbees Solutions, has received the Securities and Exchange Board of India’s (SEBI) final observations on its proposed ₹1,000 crore initial public offering (IPO).

The company received the observations on October 6, 2026, after filing its draft red herring prospectus (DRHP) on July 2. The proposed offering comprises a fresh issue of equity shares worth up to ₹500 crore and an offer for sale (OFS) of up to ₹500 crore by existing shareholders.

Under the OFS, Brainbees Solutions may sell shares worth up to ₹300 crore, while Anadya Bon Merchari LLP may sell shares worth up to ₹200 crore. Swara Baby may also consider a pre-IPO placement of up to ₹100 crore. If completed, the amount raised would be deducted from the fresh issue, subject to applicable regulations.

JM Financial and Avendus Capital have been appointed as book-running lead managers. The company’s shares are proposed to be listed on the BSE and the National Stock Exchange of India.

New manufacturing capacity

Swara Baby plans to use ₹198.2 crore from the fresh issue to part-finance a new manufacturing facility in Pithampur, Madhya Pradesh. The facility is planned to manufacture baby diapers and adult incontinence products in different formats.

The expansion is expected to add annual capacity of approximately 1,464 million baby diapers and 252 million adult diapers. The broader project also includes a sanitary napkin production line.

Following completion of the planned expansion, Swara Baby’s total proposed installed annual capacity is expected to reach approximately 4,124 million baby diapers, 505 million adult diapers and 948 million sanitary napkins.

The company has earmarked a further ₹100 crore from the fresh issue for repayment or prepayment of borrowings. Another ₹27.5 crore will be invested in wholly owned subsidiaries Solis Hygiene, Swara Hygiene and K.A. Enterprises Hygiene for repayment or prepayment of their outstanding borrowings.

The remaining proceeds will be used for potential acquisitions, strategic initiatives and general corporate purposes.

Contract manufacturing across hygiene categories

Founded in 2018, Swara Baby manufactures disposable hygiene products across baby care, adult incontinence and feminine hygiene.

Its portfolio includes tape-style and pant-style baby diapers, adult diapers and other incontinence products, sanitary napkins and panty liners. The company also sells baby diapers under the Cuddles brand and adult diapers under Shield.

Swara Baby primarily operates as a contract manufacturer for consumer brands. Its customers include Brainbees Solutions, Piramal Pharma and Himalaya Wellness, while its own brands are sold through online commerce and other retail channels.

The company operates four manufacturing facilities in Pithampur and Indore, Madhya Pradesh. Together, the sites cover approximately 24 acres and comprise 20 manufacturing lines.

According to the DRHP, current installed annual capacity is approximately 2,660 million baby diapers, 253 million adult diapers and period panties, and 756 million sanitary napkins and panty liners.

Swara Baby expanded its presence in feminine hygiene through the acquisition of K.A. Enterprises Hygiene Private Limited in December 2025.

Revenue and production increase

Swara Baby reported revenue from operations of ₹1,163.9 crore in FY26, compared with ₹942.98 crore in FY25 and ₹749.96 crore in FY24.

Profit for the year increased to ₹95.59 crore in FY26 from ₹80.67 crore in FY25, while EBITDA rose to ₹192.77 crore from ₹162.72 crore.

Despite the increase in revenue and EBITDA, the EBITDA margin declined from 20.48% in FY24 to 17.26% in FY25 and 16.56% in FY26. Profit margin also declined, from 12.53% in FY24 to 8.21% in FY26.

The company produced approximately 2,032.69 million units of disposable hygiene products in FY26 and had 775 employees at the end of the financial year.

Baby diapers remain the main business

Baby diapers accounted for 78.34% of revenue from operations in FY26, compared with 83.27% in FY25 and 86.92% in FY24.

According to market estimates cited in the DRHP, Swara Baby was India's largest contract manufacturer of baby diapers by revenue in FY25, with an estimated 37% share of the country's baby diaper contract manufacturing market. It also held an estimated 36% share of the adult diaper contract manufacturing market by value.

The business remains concentrated among a relatively small number of customers. Its five largest customers accounted for 65.77% of FY26 revenue, with Brainbees Solutions contributing ₹263.46 crore, or 22.64% of revenue from operations.

Growth in India's disposable hygiene market

Swara Baby's expansion comes as demand for disposable hygiene products grows across India's baby care, adult incontinence and feminine hygiene segments.

Market estimates cited in the company's DRHP put India's addressable disposable hygiene market across these categories at ₹240.6 billion in FY25, with the market projected to reach ₹438.4 billion by FY30, representing a compound annual growth rate of 12.7%.

The company identifies rising disposable incomes, urbanization, the growth of nuclear households, wider access to modern retail and e-commerce, and increasing awareness of hygiene products as key drivers of demand.

India remains Swara Baby's primary market, although the company is also developing export opportunities in the Middle East and Africa and the Asia-Pacific region. Overseas revenue reached ₹17.46 crore in FY26, representing 1.5% of total revenue.

Operational and customer concentration risks

The DRHP highlights several risks associated with Swara Baby's business. All four of its manufacturing facilities are located in Madhya Pradesh, creating geographic concentration in its manufacturing operations.

The company also depends on a relatively limited number of major customers, while its customer arrangements do not necessarily guarantee minimum order volumes. Its top ten customers accounted for 80.31% of revenue from operations in FY26.

Other risks identified include raw-material price volatility and availability, pricing pressure from corporate customers, dependence on key suppliers, imported raw materials and manufacturing equipment, high working-capital requirements, existing borrowings and competition from branded hygiene companies and other contract manufacturers.

SEBI's final observations mark an important step in Swara Baby's proposed IPO process. The company has yet to announce the final price band, lot size and bidding dates. The planned issue is intended to provide funding for manufacturing expansion and debt reduction as Swara Baby broadens its presence across India's baby, adult and feminine hygiene markets.