Aditya Birla Fashion and Retail (ABFRL) is about to boost up to Rs 2,195 crore from Singapore’s sovereign wealth fund GIC. After the complete investment, GIC will own a 7.5% equity stake in ABFRL, while Aditya Birla Group will hold 51.9%. Walmart’s Flipkart, too, holds 7.8% in ABFRL through its Rs 1,500-crore investment made last year.
ABFRL plans to use this capital to accelerate its growth engine built round the strength of its current businesses together with a rapidly evolving play in emerging high-growth business models. ABFRL, which has been on a shopping spree of indigenous designer brands, plans to use this capital to accelerate its growth engine built round the strength of its current businesses together with a rapidly evolving play in emerging high-growth business models. ABFRL, which sells several apparel brands in India, including Louis Philippe, Van Heusen, and Allen Solly, has acquired stakes in brands of Indian design houses like Jaypore, Shantanu, Nikhil, Tarun Tahiliani, and Sabyasachi.
In December, it marked its entry into the sportswear category by usurping Reebok in India and other Asean markets through a long-term contract with Authentic Brands Group (ABG). Within the following month, it bought 51% of House of Masaba Lifestyle for around Rs 90 crore to bolster its portfolio of fashion labels.
Mr. Kumar Mangalam Birla, Chairman of Aditya Birla Group said, “Indian fashion industry is about for robust long-term growth thanks to strong fundamentals of an outsized and growing socio-economic class, and aspiration for brands.
ABFRL has become one amongst the leading players during this market through its diversified portfolio of strong brands, wide distribution & and established business model and is well positioned to learn from this chance. i’m delighted to welcome GIC, a world institutional investor, as a long-term partner within the company’s exciting growth journey.
Mr. Choo Yong Cheen, Chief Investment Officer of personal Equity for GIC said, “We are delighted to partner with Aditya Birla Fashion and Retail to bring our long-term capital and resources to support its next phase of growth.
ABFRL contains a strong diary of building brands and its new business lines, including innerwear and ethnic wear, have strong structural tailwinds. We are confident that the corporate is well-positioned to continue its transformational journey into a future-ready consumer company powered by the expansion of India”.
Mr. Pankaj Sood, Head of Direct Investments, India and Africa, GIC said “Branded apparel could be a large and attractive market, and that we believe that ABFRL is well-positioned with its best-in-class management team, a powerful portfolio of brands, and robust plan for capturing the subsequent phase of digital-led growth.
We still are excited about the long-term outlook of India and are keen to participate in ABFRL’s sustained structural growth driven by improving demographics.”
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