FirstCry Tumbles 7% On Q4 Loss, Margin Pressure

Shares of Brainbees Solutions, the parent of omnichannel kidswear brand FirstCry, fell as much as 7% during the intraday trading today as investors remained cautious after the company posted yet another loss-making quarter. 

The stock later pared some of the losses and was trading at ₹225.4, down about 5%, at 11:38 IST. The company’s market capitalisation stood at ₹11,770 Cr (about $1.2 Bn).

Yesterday, the company reported a 57% decline in its consolidated net loss to ₹48.2 Cr in the fourth quarter of FY26 from ₹111.5 Cr in the same period a year ago. Sequentially, however, loss widened 26% from ₹38.4 Cr in Q3 FY26. 

Operating revenue rose 12% to ₹2,162.7 Cr during the quarter under review from ₹1,930.3 Cr a year earlier, while total expenses increased 9% to ₹2,092.6 Cr.

Including other income of ₹40.8 Cr, total income stood at ₹2,203.5 Cr.

For the full FY26, FirstCry’s net loss narrowed 23% to ₹203.7 Cr, while operating revenue grew 12% to ₹8,547.9 Cr. Gross merchandise value for the fiscal year rose 10% to ₹11,643.4 Cr, while adjusted EBITDA increased 24% YoY to ₹486 Cr.

The company also approved an investment of up to 34 Mn UAE dirhams (about ₹88.1 Cr) in its UAE-based wholly owned subsidiary, Firstcry Management DWC LLC, to expand operations in Saudi Arabia and the UAE. 

The investment will be funded through proceeds from the company’s IPO and is expected to be completed by June 30.

Operationally, FirstCry expanded its faster-delivery initiative RocketBees from 22 cities to 62 cities and rolled out its Qwik delivery service across select pin codes in five cities. 

The company said its offline gross merchandise value grew in the mid-teens during the fourth quarter of fiscal year 2026. It expects both online and offline growth rates to improve structurally in the ongoing fiscal year.

In terms of business segment, the India multi-channel business remained the largest contributor to revenue, raking in ₹5,753.3 Cr in FY26, up 9% YoY.

The international business, which includes the UAE and Saudi Arabia operations, posted 10% revenue growth to ₹947.4 Cr. GlobalBees delivered 20% YoY growth in revenue at ₹1,894.3 Cr during the year.

Following the results, Morgan Stanley maintained its equal-weight rating on FirstCry with a target price of ₹300, implying a 10% upside. The brokerage noted that margins were weighed down by competitive intensity in the diapers segment and higher manufacturing costs.

The company’s management expects India business growth in FY27 to improve over FY26 levels, with manufacturing-related margin pressures expected to reverse in Q2 FY27. 

Competitive intensity in the diapers category, however, may persist for another four to six quarters, the brokerage noted.

On the expansion front, the company is targeting more than 100 store additions in FY27.

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