Manyavar owner Vedant Fashions planning IPO in second half of FY19

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Mumbai: The management of Vedant Fashions Pvt. Ltd, the owner of ethnic wear brand Manyavar, is evaluating an initial public offering (IPO) and is expected to soon initiate a formal process for the same, three people aware of the development said.

“They are expected to start a formal process to appoint bankers for the proposed Manyavar IPO, as early as next month,” said one of the people cited above, requesting anonymity as he is not authorized to speak with the media.

According to a second person, the Manyavar IPO is likely to happen in the second half of the financial year 2018-19. “If they decide to go ahead with the IPO, it will most likely happen in late 2018,” this person said.

Founded by Ravi Modi in 1999, the Manyavar brand of garments is sold in over 400 stores.

Vedant Fashions reported a profit of Rs111.3 crore on a revenue of Rs610.2 crore in the financial year 2016-17, according to data from the company’s filings with the Registrar of Companies.

Vedant Fashions is backed by Kedaara Capital, which last year invested around Rs400-450 crore in the company for a 10% stake, reported the Economic Times. In May, Mint had reported that private equity firms Kedaara Capital and L Catterton were in discussions to pick up a minority stake in the retailer.

Manish Kejriwal and Sunish Sharma, managing partners at Kedaara Capital said that the firm does not comment on market speculation. Emails sent to Vedant Fashions and text messages sent to Ravi Modi, did not elicit any response.

Vedant Fashion reported a revenue of Rs610.24 crore in the financial year 2016-17, a growth of 21% over the revenue of Rs504.27 crore reported in the previous year. In 2016-17, the company’s profit grew 23.5% to Rs111.3 crore, as against a profit of Rs90.1 crore in the previous year.

In recent times Vedant hasbought other firms to grow its business. Mint reported in August that it was acquiring Hyderabad-based rival Mebaz.

Manyavar is not the only fashion retailer that is looking at the opportunity of tapping the buoyant Indian initial share sale market. In September, Mint reported that TCNS Clothing Co. Pvt. Ltd, the owner of women’s apparel brands W, Aurelia and Wishful, has hired investment banks Citibank and Kotak Mahindra Capital to manage its initial share sale.

TCNS Clothing is likely to raise around Rs700-750 crore through a mix of fresh issue of shares and secondary share sale by existing investors, Mint reported.

Other consumer companies that have went public in the recent past includes names such as Coffee Day Enterprises Ltd, Manpasand Beverages Ltd, Khadim India Ltd, Prataap Snacks Ltd and Parag Milk Foods Ltd.

Manyavar’s plans to go public come at a time when the Indian IPO market has seen its best year ever.

In 2017, 36 companies raised Rs67,147 crore through the IPO route, while 26 companies raised Rs26,493.8 crore in 2016, data from primary market tracker Prime Database shows.livemint