I’m thrilled to sit down with Milena Traikovich, a seasoned expert in demand generation who has helped countless businesses craft impactful campaigns to attract high-quality leads. With her deep expertise in analytics and performance optimization, Milena offers invaluable insights into the evolving landscape of consumer electronics and corporate strategies. Today, we’ll dive into the recent IPO plans of boAt, a leading homegrown audio and wearables brand, exploring their financial strategies, marketing initiatives, and their vision to solidify their position as a digital-first consumer brand.
Can you share your thoughts on why boAt might have chosen this moment to file for an IPO, especially with a revised issue size of Rs 1,500 crore down from Rs 2,000 crore?
Timing is everything when it comes to IPOs, and boAt’s decision likely reflects a strategic response to market conditions. Reducing the issue size could indicate a more cautious approach, ensuring they don’t overreach in a volatile market. It might also suggest they’ve recalibrated their growth plans or investor expectations since 2022, focusing on a more sustainable raise that aligns with current economic realities. This move could help them attract the right investors while maintaining confidence in their valuation.
How do you see the timing of this IPO influencing boAt’s growth trajectory in the competitive consumer electronics space?
Launching an IPO now could position boAt to capitalize on the growing demand for audio and wearable products, especially if they can leverage the funds effectively. However, the market is crowded, and consumer preferences shift quickly. The timing might give them a financial edge to scale operations or innovate, but they’ll need to navigate challenges like declining wearable sales and increased competition. It’s a bold move that could either accelerate their dominance or expose them to heightened scrutiny.
What’s your take on how boAt plans to allocate the Rs 225 crore for working capital, and why is this significant for their day-to-day operations?
Allocating Rs 225 crore for working capital is a smart play to ensure operational fluidity. This funding likely supports inventory management, supply chain efficiency, and meeting short-term obligations—crucial for a company dealing with high-volume sales across 12,000 offline retailers. In a fast-moving sector like consumer electronics, having this financial cushion helps them respond to demand spikes or unexpected disruptions without hiccups.
With Rs 150 crore earmarked for brand-building and marketing, what kind of impact do you think boAt is aiming for with this investment?
This investment signals boAt’s intent to double down on visibility and customer loyalty. Rs 150 crore over three years is substantial, and it’s clear they want to solidify their identity as a trendy, accessible brand. The focus will likely be on creating memorable campaigns that resonate with younger demographics, enhancing their digital presence, and differentiating themselves in a saturated market. It’s about building an emotional connection, not just pushing products.
Why do you think boAt’s marketing budget is set to ramp up from Rs 28 crore in FY26 to Rs 62 crore in FY28?
The gradual increase suggests a long-term vision for brand equity. Starting at Rs 28 crore in FY26 might be about testing new strategies or channels, while scaling to Rs 62 crore by FY28 indicates confidence in ramping up aggressive campaigns as they see returns. It could also reflect plans to expand into new markets or product categories, requiring heavier investment over time to build awareness and trust in those areas.
What types of marketing strategies or campaigns might boAt prioritize to boost their product and brand visibility with this budget?
Given their digital-first approach, I’d expect a heavy focus on social media and influencer partnerships, targeting Gen Z and Millennials who dominate their customer base. We might see immersive online campaigns, interactive content, or even collaborations with popular figures in music and lifestyle spaces. Additionally, with their offline reach, localized promotions and experiential events could play a role in deepening brand recall across diverse regions.
boAt emphasizes being a leading digital-first consumer brand—can you unpack what this strategy entails and how it shapes their customer engagement?
Being digital-first means prioritizing online channels for sales, marketing, and interaction. For boAt, this likely involves leveraging e-commerce platforms, social media, and data analytics to understand and engage customers in real-time. It’s about creating seamless online experiences—think personalized recommendations or quick customer service via apps. This approach helps them stay agile, adapt to trends, and build a community around their brand, which is vital in a tech-savvy market.
How do you think this digital-first focus gives boAt a competitive edge in the audio and wearables market?
It allows boAt to connect directly with consumers, cutting through traditional retail noise. They can gather instant feedback, tailor offerings, and roll out campaigns faster than competitors who rely heavily on offline models. In a market where audio contributes over 84% of their revenue, this agility helps them maintain dominance. However, with wearables declining, they’ll need to use digital insights to innovate or risk losing ground to rivals.
Looking at boAt’s FY25 financials, with a profit of Rs 61.08 crore on revenue of Rs 3,070.38 crore, how do you assess their performance?
These numbers show a solid foundation—revenue over Rs 3,000 crore is impressive for a homegrown brand in this space. The profit margin, while not huge, indicates they’re managing costs decently despite heavy ad spends of Rs 389.7 crore. It reflects a balance between growth and profitability, though reliance on audio for over 84% of revenue suggests vulnerability. Overall, it’s a strong performance, but diversification will be key moving forward.
Since the wearables segment has seen a revenue drop over the last three years, what strategies might boAt explore to turn this around or diversify their income streams?
The decline from Rs 901.5 crore in FY23 to Rs 330 crore in FY25 is concerning, especially with competition and softening demand at play. boAt could focus on innovating within wearables—think unique features or affordable premium models to regain traction. Diversifying might mean expanding into adjacent categories like smart home devices or accessories. They could also push harder into international markets like the Middle East to spread risk and tap new revenue sources.
What is your forecast for boAt’s growth and market position in the next few years, especially post-IPO?
I’m cautiously optimistic about boAt’s future. The IPO funds, if used wisely, could fuel significant expansion and innovation, especially in marketing and operations. Their digital-first strategy positions them well to adapt to consumer trends, but the wearables slump and heavy audio reliance are red flags. If they diversify effectively and maintain brand momentum, they could solidify their spot as a market leader. However, intense competition means they’ll need to stay nimble—post-IPO scrutiny will only raise the stakes.
