GIC to invest $283m for 7.5% stake in India's Aditya Birla Fashion and Retail

Aditya Birla Group chairman Kumar Mangalam Birla is closely tracking the progress of the online fashion store. Photo: Abhijit Bhatlekar/Mint

Aditya Birla Fashion and Retail Limited (ABFRL) Tuesday said that its board has approved raising of up to $283 million (Rs.2,195 crore) from an affiliate of GIC, Singapore’s sovereign wealth fund.

ABFRL will raise the aforementioned amount by way issue of preferential issuance of equity and warrants, it said in a press statement. GIC will invest Rs. 770 crore now towards subscription of equity and warrants, followed by up to Rs. 1,425 crore in one or more tranches within 18 months upon exercise of warrants, it added.

Post the investment, GIC will own 7.5% equity stake in ABFRL while Aditya Birla Group will hold 51.9% stake in the company.

ABFRL, operates brands such as Louis Philippe, Van Heusen, Allen Solly and Peter England in India, said it plans to use this capital to accelerate its growth engine built around strength of its current businesses along with a rapidly evolving play in emerging high-growth business models.

“In the last few years, ABFRL has built a strong presence across all large and attractive segments of the Indian fashion market through organic and inorganic actions. This capital infusion will allow us to accelerate the growth of this platform of strong brands and well-established retail formats in the fast-growing branded apparel market and fortify our position as one of the leading players in the industry,” said Ashish Dikshit, MD of ABFRL.

“We look forward to benefit from GIC’s extensive experience of investing in businesses globally and its long-term orientation as we plan to expand our presence and significantly enhance our digital play in the coming years to benefit from rapidly evolving consumer habits,” Dikshit added.

ABFRL, a part of The Aditya Birla Group, has a network of 3,468 exclusive stores, 6,515 points of sale in department stores and 28,585 multi-brand outlets across India as on 31st March 2022. The company’s international brands portfolio includes The Collective, one of the largest multi-brand retailers of international brands in India. It also has exclusive partnerships with Ralph Lauren, Hackett London, Ted Baker, Fred Perry, Forever 21, American Eagle and Reebok.

As on March 31, 2022, the company had revenues of Rs. 8,136 crore and retail space of 9.2 million sq. ft.

“Indian Apparel industry is set for robust long-term growth due to strong fundamentals of a large and growing middle class, favourable demographics,
rising disposable incomes and aspiration for brands. ABFRL has become one of the leading players in this market through its diversified portfolio of strong brands, wide distribution & an established business model and is well positioned to benefit from this opportunity,” said Kumar Mangalam Birla, Chairman Aditya Birla Group said.

 

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