Monte Carlo Fashions to stitch up an IPO, eyeing expansion

As markets remain charged up, Initial Public Offering (IPO) street is abuzz with action. The latest name hitting the bourses will be woollen hosiery garments maker - Monte Carlo Fashions. Though the Ludhiana based company is already sitting on cash, it says a public listing will broaden its stake holder base and identity. Reports CNBC-TV18's Zahra Khan and Gopika Gopakumar."It’s the way you make me feel"... Monte Carlo will be certainly hoping that the feeling is a warm and cosy one as it gets ready to hit the capital market next week. The company best known for its woollen wear brand is likely to launch its public issue on 3rd December. Promoters will be diluting 17.5 percent stake through an offer for sale while PE-investor Samara Capital will be divesting 7.5 percent equity. The company says coming out with an IPO will give it access to easy capital, help it get to know the financial fraternity better and make it easier to plan acquisitions as and when an opportunity arises.Sandeep Jain, Executive Director, Monte Carlo said, “we have around 175 crore in cash and that we have set aside for future acquisitions. We would definitely like to look at the opportunities which are there in areas in which we are not present like shoes ethnic wears. We are not present in suitings, in women western wear. And that cash can be used in that case for inorganic acquisitions"Monte Carlo Fashions saw its top line grow 25 percent to Rs 518 crore in the last financial year. Profits grew 11 percent to Rs 55 crore. Part of the Nahar Group which also owns Oswal Woollen Mills, the company has been a household name in North India. The challenge now is to go pan-India and expand presence across different geographies. Monte Carlo has drawn up an aggressive store roll out plan for the same which will see the company's store count grow to 275 from 192 at present.Jain also added, “definitely showrooms will be open at a pan-India. I think the showroom which is going to open will be northern eastern, southern and western market. More will be in northern and eastern market and others will come in south and west market also"More showrooms will also mean more products and more categories. Traditionally seen as a men's apparel brand, Monte Carlo is now looking at scaling up revenues from women's apparel from the current 30 percent to 50 percent of the total revenue pie. It’s also looking at boosting presence in the kids wear segment which is growing at over 10 percent as consumer sentiment lifts and markets look energised, it’s probably an interesting time for Monte Carlo to dress up for its new public avatar.