BIBA Fashion IPO
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Last Updated: 14 August 2023 11:14 AM by rahul_raskar
Well-known ethnic wear brand, Biba Fashion is set to come up with an IPO and has filed its preliminary paper with SEBI. The IPO will be in the form of issuance of equity shares worth Rs 90 crores and an OFS of 2.77 crore equity shares by promoter and existing investors. Promoter, Meena Bindra will offload up to 37.52 lakh equity shares and private equity investors, Warburg Pincus-backed Highdell Investment and Faering Capital India Evolving Fund will sell up to 1.84 crore and 55.86 lakh equity scrips, respectively.
JM Financial, Ambit, Equirus Capital, DAM Capital Advisors and HSBC Securities and Capital Markets (India) are the book running lead managers to the issue.
Objectives of the BIBA IPO
The net proceeds from the fresh Issue will be used towards
1. funding of Repayment and /or prepayment of certain borrowings availed by the company estimated to be ₹70 crore
2. general corporate purposes
Biba Fashion, backed by Warburg Pincus and Faering Capital, is one of the largest lifestyle brands in the women’s Indian wear market in India in terms of market share. It was Launched in 1986, our flagship brand, BIBA.
The company develops, designs, sources, markets and sells a wide portfolio of Indian wear for women and girls across multiple brands, catering to almost all of a woman's Indian wear needs and also offers consumers a range of products across jewellery, footwear, wallets and fragrances.
The company was mainly focused on Indian market but has been slowly expanding globally. It currently has presence in Canada, Nepal, and UAE and plans to increase its global reach to USA and Australia by end of first quarter of FY23.
The company also has strong online presence and operates via its own websites and other third-party marketplaces such as Myntra, Amazon, Flipkart, Nykaa and Tata Cliq. The digital orientation of the business model gie the company a good edge over its peers. In physical terms, it has 427 EBOs, comprising 308 BIBA-branded outlets and 119 Rangriti-branded outlets across 27 states and 160 cities in India, 930 LFSs across 29 states and 267 cities in India and 30 MBOs. EBOs are located nationwide across high streets, malls and residential market areas in major metros, large cities, other tier II and tier III cities and at airports
The product portfolio includes products from flagship brand Biba, Rangriti, BIBA by Rohit Bal BIBA Girls and its first fragrance under our beauty brand, Spelle.
| Particulars (in Rs. Crores) | FY21 | FY20 | FY19 |
|---|---|---|---|
| Revenue | 525.8 | 757.2 | 729.4 |
| EBITDA | 62.3 | 135.3 | 129.7 |
| PAT | 57.6 | -79.9 | -79.1 |
| Particulars (in Rs. Crores) | FY21 | FY20 | FY19 |
|---|---|---|---|
| Total Assets | 832.5 | 931.5 | 830.5 |
| Share Capital | 75.7 | 75.7 | 75.7 |
| Total Borrowings | 109.8 | 144.2 | 103.4 |
| Particulars (in Rs. Crores) | FY21 | FY20 | FY19 |
|---|---|---|---|
| Net cash generated from / (used in) operating activities | 60.85 | 75.97 | 110.14 |
| Net cash from / (used in) investing activities | -11.05 | -29.88 | -28.87 |
| Net cash flow from / (used in) financing activities | -48.07 | -50.64 | -80.16 |
| Net increase (decrease) in cash and cash equivalents | 1.73 | 4.54 | 1.11 |
Peer Comparison
| Name of the Company | Total Income (in Rs. crores) | Basic EPS | NAV Rs. per share | PE | RoNW% |
|---|---|---|---|---|---|
| BIBA Fashion Limited | 569.2 | -0.96 | 25.28 | NA | -3.74% |
| TCNS Clothing Company Limited | 684.5 | -8.85 | 99.47 | NA | -9.21% |
| Trent Limited | 2794.6 | -4.11 | 65.07 | NA | -6.32% |
| Go Fashion (India) Limited | 282.3 | -0.68 | 94.31 | NA | -1.25% |
| Vedant Fashions Limited 625.0 | 625.0 | 5.36 | 44.0 | 188.6 | 12.18% |
| Aditya Birla Fashion and Retail Ltd | 5322.3 | -8.23 | 28.2 | NA | 12.18% |
Strengths
1. Leading market position and strong brand equity across a diverse set of consumers across the value chain
2. Diversified pan-India multichannel distribution with a strong foothold on both offline and online channels
3. Significant investments made in digital capabilities with a strong focus on technological efficiencies resulting in leadership online (across both marketplaces and our own websites)
4. Strong in-house design and tech-first supply chain capabilities to deliver innovative and high-quality products
5. Capital-efficient and scalable retail model to capitalise on the strong industry growth profile driven by secular tailwinds and a rapid shift towards organised retail and increasing online penetration
Professional, founder-driven management team with deep industry expertise and track record, and backed by marquee private equity investors
Risks
1. Highly concentrated on women’s Indian wear apparel and vulnerable to variations in demand and changes in consumer preferences
2. Business prospects depend on the strength of the key brands, and any failure to maintain or grow sales of the products could adversely affect the business.
3. Unsuccessful launch of new products
4. Relies on outsourcing a significant proportion of the production processes and activities to third-parties, without exclusivity arrangement
5. Inability to identify and retain skilled third-party suppliers, vendors and manufacturers for various parts of the production or procurement processes
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FAQs
The price band ranges between Rs. 610 to Rs. 643 per share
Biba Fashion Limited IPO opens on May 24, 2022, and closes on May 26, 2022
The IPO comprise a fresh issue of equity shares aggregating to Rs 627 crore and an offer-for-sale (OFS) of up to 28.2 lakh equity shares.
The allotment date for the IPO is May 31, 2022
The Biba Fashion IPO listing date is June 3, 2022
The Biba Fashion Limited IPO lot size is 23 shares. A retail investor can apply for minimum of 1 lot (13 shares or Rs. 14,766) and maximum up to 13 lots (299 shares or Rs. 191,958).
The proceeds from the issue will be used in the following manner:
1. Rs.136 crore is being kept aside for funding the capital expenditure requirements for the Greenfield project
2. Rs.211.4 crore is to be used to repay or prepay debt availed by the company
3. Rs.165 crore will be used to fund the working capital expenditure requirements of the company
To apply for the IPO, follow the steps given below
• Login to your 5paisa account and select the issue in the current IPO section
• Enter the number of lots and price at which you wish to apply for
• Enter your UPI ID and click on submit. With this, your bid will be placed with the exchange
You will receive a mandate notification to block funds in your UPI app
Biba Fashion is promoted by Ashwin Jayantilal Desai, Purnima Ashwin Desai, Rohan Ashwin Desai, Dr. Aman Ashvin Desai, AJD Family Trust, PAD Family Trust, RAD Family Trust, AAD Family Trust and AAD Family Trust.
HDFC Bank Ltd and Kotak Mahindra Capital Company Ltd are the book running lead managers to the issue.