Urban Company Limited, India's largest tech-enabled home services marketplace, opened its Rs 1,900 crore initial public offering (IPO) on Wednesday, September 10, 2025. The subscription window will remain open until Friday, September 12, and stock will be listed on the BSE and NSE on September 17.
The IPO comprises a fresh issue of ₹472 crore and an offer-for-sale (OFS) of ₹1,428 crore by existing investors. The price band is fixed at ₹98-₹103 per share, with each lot of 145 shares. At the upper price band, Urban Company will be valued close to ₹14,800 crore.
Anchor investors have already shown confidence, with the firm raising Rs 854 crore ahead of the IPO by allotting shares at Rs 103 apiece.
On day one, Urban Company's shares were trading at a Rs 35-Rs 37 premium, indicative of potential listing gains of about 35-36%. The GMP for Urban company was being pushed up all week; it was 28 earlier in the week, but has been increasing due to demand from retail and institutional investors.
By 10:00 AM on Day 1, the issue was subscribed to 0.05 times overall (retail at 0.13 times; non-institutional investors at 0.11 times). Although the initial subscription level is low, analysts expect demand to grow as the issue progresses.
Urban Company reported a revenue of Rs 1,144.5 crore for FY25, reflecting a strong 38% year-on-year growth. The company's progress to profitability is a positive shift, posting a net profit of Rs 240 crore; primarily driven by a deferred tax credit of Rs 211 crore. The pre-tax profit has weakened significantly, at Rs 28 crore, and suggests thin operating margins.
At the upper band of Rs 103, the IPO values Urban Company at a P/E of 65.7x FY25 earnings and a P/S multiple of 12.9x. Brokerages describe the issue as 'fully priced,' leaving limited room for near-term re-rating.
However, experts emphasize the company’s strong brand recognition, expanding service verticals, better unit economics, and commitment to formalizing a fragmented home services industry in India as long-term positives.
Lemonn Markets: Apply with caution - high-risk, high-reward play for long-term investors.
Lakshmishree Investment: Subscribe with risk - growth justified, but valuations stretched.
Master Capital Trust & others: Subscribe - long-term structural story with market leadership.
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Urban Company’s IPO offers exposure to a fast-growing, under-penetrated home services sector with significant growth potential in beauty, cleaning, appliance repair, and new categories, such as InstaHelp.
However, the high valuations, thin profitability, and need to scale and execute mean it is a bet only for investors willing to accept high risks and a long horizon.
Overall, analysts recommend a 'Subscribe with Caution' position, which is worthwhile for believers in the digital services economy, but not without risks.