SUGAR Cosmetics Raises ₹144.5 Cr at ₹755 Cr Valuation as Business Faces Reset

Indian beauty brand SUGAR Cosmetics has raised ₹144.5 crore from existing investor A91 Partners as the company works to stabilise its business amid declining revenue and continued pressure on profitability.

The company approved the allotment of 1,12,248 Series CCPS at an issue price of ₹12,871 per share, with A91 Partners subscribing to the entire issue. Based on the allotment and resulting shareholding, the transaction values SUGAR at approximately ₹755 crore post-money.

The latest valuation represents a significant decline from the company's peak valuation of around ₹3,000 crore in 2022.

A major valuation correction

SUGAR was valued at approximately $400 million, or around ₹3,000 crore, when it raised $50 million in a Series D round led by L Catterton in 2022.

At the time, the company was expanding its offline retail presence and had established itself as one of India's prominent youth-focused beauty brands.

The latest round marks a substantial reset in investor expectations. A91 Partners will hold approximately 19.97% of SUGAR following the new investment.

The funding also comes as some early investors reportedly explore secondary sales of their holdings. Sources indicate that investors are looking to sell stakes worth up to ₹150 crore, with some discussions taking place at significant discounts to the company's previous valuation.

Revenue and profitability under pressure

Founded by Vineeta Singh and Kaushik Mukherjee, SUGAR started as an online-first cosmetics company before building a large offline distribution network.

The company sells makeup and personal care products through its own platform, online marketplaces and retail outlets.

However, its financial performance has weakened. SUGAR's revenue declined 20% to ₹404 crore in FY25 from ₹505 crore in FY24.

At the same time, its net loss nearly doubled to ₹135 crore from ₹68 crore in the previous financial year.

The decline has increased pressure on the company to improve revenue growth, profitability and unit economics.

A91 doubles down while others seek exits

The latest funding creates an interesting contrast among SUGAR's investors.

While some early backers are reportedly seeking liquidity at significantly reduced valuations, A91 Partners has chosen to inject another ₹144.5 crore into the business.

The fresh capital provides SUGAR with additional resources to stabilise operations and potentially rebuild its growth trajectory.

The company still has significant brand recognition and an established distribution network, giving it a foundation to recover if it can strengthen its product portfolio, improve operating economics and return to sustainable growth.

A new chapter for SUGAR

SUGAR's latest fundraise highlights the broader correction that has taken place across India's D2C ecosystem since the peak of the funding cycle.

The company has moved from a ₹3,000 crore valuation in 2022 to approximately ₹755 crore today, while simultaneously dealing with declining revenue and rising losses.

For SUGAR, the immediate priority is no longer simply expansion. The company now needs to demonstrate that its brand, retail footprint and product portfolio can translate into profitable and sustainable growth.