Aditya Birla Fashion and Retail acquires ethnic brand Jaypore
12 Jun 2019
Aditya Birla Fashion and Retail Ltd (ABFRL), which retails brands such as Louis Philippe, Peter England and Van Heusen, has acquired ethnic apparel and lifestyle retailer Jaypore for Rs110 crore, the company said in a filing with the stock exchange on Monday.
The deal will help ABFRL that retails western wear for both men and women to tap into the fast-growing ethnic apparel market.
“Ethnic wear is the largest segment in the Indian fashion apparel market. While ABFRL has built a diversified portfolio of brands across different segments, ethnic wear space is currently under-represented in our bouquet of offerings to consumers," Ashish Dikshit, managing director, ABFRL said in a media release.
“Board of directors of the company, at its meeting held today...have approved entering into a share purchase agreement with the existing shareholders of ‘Jaypore E-Commerce Pvt. Ltd’, a B2B entity which sells ethnic fashion merchandise under its own brand ‘Jaypore’ and of other third-party brands," ABFRL said in its filing. The proposed acquisition is a “great strategic addition to our portfolio and gives us a strong footing in a segment that is growing in double digits," Dikshit said.
Jaypore was set up in 2012 by Puneet Chawla and Shilpa Sharma as an online platform to service the US market. Rising domestic demand prompted the company to launch in India in 2013.
The company, which sells apparel and accessories, has now a presence in both online and offline retail. It has two stores—one each in Delhi and Mumbai—and sells a curated collection of handmade and handcrafted apparel, jewellery and home textiles sourced from across India through its own website. The brand sells to over 60 countries.
Angel investor Haresh Chawla and Aavishkaar Venture Fund were among its early investors.
For FY19, Jaypore posted a turnover of ?39 crore, down from ?41.9 crore it posted a year ago.
SBFRL expects the deal to conclude in 30-45 days. Going forward, the company will continue to build on Jaypore’s offline stores to make it a significant part of its portfolio.
ABFRL runs 2,714 branded stores in 750 cities in India, apart from its brands being retailed across 18,000 multi-brand outlets here.
ABFRL that also runs the fashion departmental store chain Pantaloons posted a turnover of Rs8,118 crore in fiscal year 2019.
India’s domestic apparel industry stood at Rs5,40,800 crore in FY18, growing at a CAGR of 13.8 per cent since 2010. While men’s western apparel forms a major chunk of all clothes sold in the country, women’s apparel comprises 38 per cent of India’s overall apparel market.
Ethnic wear is the largest sub-segment, according to data from CARE ratings.