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TCNS Clothing recruits investment banks for IPO

LiveMint logoLiveMint 06-09-2017 Swaraj Singh Dhanjal

Mumbai: 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, three people aware of the development said, requesting anonymity.

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, one of the three people said. The company will file its draft IPO documents with the markets regulator by December, the person said.

In May, Mint reported that the company had initiated discussions with investment banks for its IPO.

US-based private equity firm TA Associates invested $140 million in TCNS Clothing in August 2016. As part of its investment, TA acquired the stake of venture capital firm Matrix Partners, which had invested about Rs100 crore in TCNS Clothing since 2011.

“We would not like to comment about any media speculation,” said Naresh Patwari, director at private equity firm TA Associates.

Citibank too declined to comment. Emails sent to TCNS Clothing and Kotak Mahindra Capital did not elicit any response.

TCNS Clothing’s products are sold through more than 1,600 outlets across India, Mauritius, Sri Lanka and the Middle East.

It is also available in over 350 exclusive stores in more than 100 cities. The three brands have a strong presence across large multi-brand retailers and online portals. W’s first store opened in 2001 in Delhi.

The company was founded in 2001 by brothers Onkar and Arvinder Pasricha.

According to filings with the Registrar of Companies, TCNS Clothing’s standalone revenue rose 65% to Rs590.67 crore in 2015-16 from Rs348.75 crore in the previous year. Its profit more than doubled to Rs62.51 crore from Rs27.27 crore.

The company’s Ebitda (earnings before interest, taxes, depreciation and amortization) margin widened to close to 20% in 2015-16 from 16.5% in the previous year, RoC filings show.

So far this year, 17 companies have raised Rs14,181.64 crore through initial share sales, data from primary market tracker Prime Database shows. In 2016, 26 companies raised Rs26,493.8 crore.

Investors betting on consumer companies in the primary markets have been rewarded well in the past few years.

Avenue Supermarts Ltd, the parent of hypermarket chain D-Mart, sold its shares at Rs299 each in a public offering that was subscribed 104.5 times. On Wednesday, the company shares ended trading at Rs1067.9.

Manpasand Beverages shares have risen to Rs830 as of closing on Wednesday from Rs320 when the company went public in June 2015.

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