New Delhi, May 15 -- The asset management arm of Mumbai-based Neo Group has invested Rs 170 crore ($20 million) in disposable hygiene products maker Nobel Hygiene Pvt. Ltd through a mix of primary and secondary transactions.

Neo Asset Management, which manages over Rs 11,000 crore of alternative assets across private equity, private credit, and real estate asset classes, will join healthcare-focused private equity firm Quadria Capital and consumer-focused venture capital firm Sixth Sense Ventures onboard Nobel Hygiene's cap table.

Nobel Hygiene didn't disclose details of the transaction, including the identity of the selling shareholders.

Sixth Sense had led the company's Series C round in September 2022. Quadria first invested in 2021.

Nobel Hygiene will look to increase its presence in the adult diaper market by expanding its distribution network and investing in its flagship brands, according to a statement. "This investment poises Nobel Hygiene for its next phase of growth as it steers towards its IPO," it said.

The announcement comes almost a year after VCCircle reported that a couple of private equity firms were in the race to pick up a stake in Nobel Hygiene.

Founded in 2000, Nobel Hygiene makes adult diapers, maternity pads, adult pull-ups, underpads, nappy pads, and baby diapers. It markets its baby diapers under the Teddyy and Snuggy brands, while adult incontinence products are sold under the Friends brand.

The Friends brand commands a market share of 40%, the statement said, adding that the adult diaper market is likely to be a $1 billion category by 2030, growing at a 25% compounded annual growth rate.

The company has a manufacturing capacity of over 6,000 units per minute and exports its items to over 20 countries besides selling across India.

The company posted net sales of Rs 728.5 crore during FY24, up from Rs 688.6 crore the year before. Its loss narrowed to Rs 39 crore from Rs 66 crore in 2023-24, as per VCCEdge, the data research platform of VCCircle.

Published by HT Digital Content Services with permission from VC Circle.