The Kuku FM IPO filing has turned the spotlight on an entire sector that most public-market investors have never had a chance to price: vernacular audio entertainment. Parent company Mebigo Labs has reportedly filed confidential draft papers with SEBI for an offering valued at up to ₹3,500 crore, appointing a roster of bankers that includes Kotak Mahindra Capital, Jefferies, JM Financial, and Axis Capital. But the real story isn’t one company’s listing ambitions — it’s whether the broader Indian audio OTT space has proven its economics well enough for the public markets.
Consider the peer contrast. Pocket FM, Kuku FM’s closest domestic rival, reported FY25 revenue of approximately ₹1,768 crore — roughly seven times Kuku FM’s ₹242 crore for the same period. By March 2026, Pocket FM’s annualised revenue run-rate had reportedly crossed $430 million. Both platforms chase the same Tier-2 and Tier-3 audience with regional-language audio content, yet they sit at very different stages of scale. Kuku FM claims over one crore paying subscribers and an 11 per cent free-to-paid conversion rate; Pocket FM, meanwhile, has built a freemium-plus-microtransaction model serving a listener base exceeding 200 million globally.
That gap matters because Kuku FM’s own financials carry a tension investors will need to resolve. Revenue nearly tripled in FY25, jumping 175 per cent from ₹88 crore to ₹242 crore. But net losses widened 59 per cent to ₹153 crore in the same year, driven overwhelmingly by advertising and marketing spend that ballooned to roughly ₹285 crore — more than the company earned. Total expenses doubled past ₹411 crore. On a per-subscriber basis, Kuku FM spent approximately ₹285 to acquire or retain each of its one crore paid users on marketing alone, while generating roughly ₹242 in revenue per subscriber annually. That ratio suggests the platform is still buying growth at a cost that exceeds what each user currently brings in.
The IPO is expected to combine a fresh issue of shares with an offer-for-sale component, though the exact split remains undisclosed. Proceeds are broadly earmarked for expanding the content library — which currently exceeds 150,000 hours across ten-plus Indian languages — and deepening Kuku FM’s push into short-form video through its newer product, Kuku TV. The company raised $85 million in a Series C round led by Granite Asia in late 2025, which valued the business at roughly $550 million post-money. Backers on the cap table include Fundamentum Partnership, the International Finance Corporation, Krafton, and Vertex Growth Fund.
What this means for the sector: If Kuku FM lists successfully by mid-2026 as reports suggest, it would be the first pure-play vernacular audio platform to test Indian public markets. That outcome would set a pricing benchmark not just for Pocket FM’s eventual exit path, but for every regional-language content startup watching from the private side. Investors evaluating the SEBI filings when the DRHP becomes public should focus on two numbers above all else: the trend in marketing cost per paid subscriber, and whether per-user revenue can outpace that spend within a clear timeline. Until that crossover is visible, the Kuku FM IPO is as much a bet on the category’s future as it is on the company’s present. Read more market stories here.
This article is journalism and educational commentary, not investment advice. The author is not a SEBI-registered Research Analyst. Figures should be independently verified against official filings before any financial decision.
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