Madhya Pradesh-based Swara Baby Products, the largest contract manufacturer of baby diapers, has received approval from the Securities and Exchange Board of India (SEBI) to proceed with its Rs 1,000-crore initial public offering (IPO).

The company, promoted by FirstCry parent Brainbees Solutions, filed its draft red herring prospectus (DRHP) with SEBI in July 2026 to raise funds through an IPO. The capital markets regulator issued its observations on the draft document on October 6.

The issuance of SEBI's observations allows the company to launch its IPO within the next year by filing a red herring prospectus with the Registrar of Companies.

Swara Baby Products has proposed to raise Rs 1,000 crore through the IPO, comprising a fresh issue of shares worth Rs 500 crore and an offer for sale (OFS) of Rs 500 crore.

Under the OFS, promoter Brainbees Solutions will sell shares worth Rs 300 crore, while Anadya Bon Merchari LLP will sell shares worth Rs 200 crore.

The company may also consider raising up to Rs 100 crore through a pre-IPO placement. If such a placement is undertaken, the size of the fresh issue will be reduced by the amount raised through the pre-IPO round.

Brainbees Solutions held a 76.59 percent stake in Swara Baby Products at the time of filing the DRHP, while Anadya Bon Merchari LLP held a 7.51 percent stake. Sangita Birla and Udit Alok Birla owned 4.88 percent and 4.8 percent stakes, respectively.

With four manufacturing facilities in Pithampur and Indore, Madhya Pradesh, Swara Baby Products undertakes contract manufacturing of diaper products for customers, who sell them to their end consumers. The company also markets its own products under two brands—Cuddles for baby diapers and Shields for adult diapers—through e-commerce and modern trade channels.

The company plans to use Rs 198.2 crore of the net proceeds from the fresh issue to set up a new manufacturing facility at Pithampur.

Another Rs 127.5 crore will be used to repay debt availed by the company and its subsidiaries, Solis Hygiene, Swara Hygiene and KAEHPL. The remaining proceeds will be used for inorganic growth through unidentified acquisitions and for general corporate purposes.

Baby diapers accounted for 79 percent of the company's revenue in FY26, while adult diapers contributed 16 percent. Feminine hygiene products, including sanitary napkins and panty liners, accounted for around 2.7 percent of revenue.

Swara Baby Products reported a profit of Rs 95.6 crore for the fiscal year ended March 2026, up 18.5 percent from Rs 80.7 crore in the previous year. Revenue rose 23.4 percent to Rs 1,163.9 crore during the same period, from Rs 943 crore a year earlier.

JM Financial and Avendus Capital have been appointed as the merchant bankers for managing the Swara Baby Products IPO.