Paper Boat to raise $50 Mn from GIC Singapore

Hector Beverages, which manufactures soft drinks and beverages under the Paper Boat brand, is in the process of raising a new round worth around $50 million from Singapore sovereign fund GIC. This is the maiden investment by GIC in the Bengaluru-based startup.

The company has passed a special resolution to issue 50,27,273 Series D party paid up preference shares at issue price of Rs 795.66 to raise Rs 400 crore or $50 million, its regulatory filing with the Registrar of Companies (RoC) shows.

Importantly, shares issued to Lathe Investments Pte (a wholly owned subsidiary of GIC Fund) will be partly paid up to the extent of Rs 397.83 per share. The rest amount will be payable as per the terms and conditions under sharing holding agreement.

Paper Boat will use these funds for business expansion and other general working capital requirements, as per the filings. The new round has come after a gap of two years. In July 2020, the startup raised around Rs 28 crore ($3.7 million) from Sofina Ventures, A91 Emerging Fund as a part of Series C round. The 10-year-old company’s investors include Sequoia Capital, Catamaran Ventures, and Trifecta Capital.

Last week, Mint reported about Paper Boat’s upcoming fundraise which also has a secondary component worth $20 million.

Founded by former Coca-Cola executives Neeraj Kakkar and Niraj Biyani, Paper Boat sells packaged juices, coconut water, traditional Indian snacks and dry fruits. It currently has a presence in 500,000 outlets across the country.

Following the fresh proceeds, GIC will hold a 25% stake in Paper Boat.  As per Fintrackr’s estimates, Paper Boat will be valued at around $205 million (post allotment). The complete shareholding pattern can be seen below:

Kakkar claims that the company is profitable and has a run rate of Rs 700 crore. While the company is yet to file its FY22 numbers, it recorded Rs 243 crore in operating revenue in FY21. The company also reported a 37% reduction in its losses to Rs 63.7 crore during the fiscal year ending March 2021.

Besides Paper Boat, GIC has backed a clutch of growth and late stage companies such as Wow Skin, CRED, Falcon X and Delhivery (now a public company) in 2022.