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Vedant Fashions, owner of top-selling Manyavar Brand, files draft papers for IPO

The Ravi Modi-founded fast-growing apparel company is backed by India-focused private equity firm Kedaara Capital and its other brands include women’s wear brand Mohey, family wear brand Mebaz, Twamev, and Manthan.

September 11, 2021 / 10:29 PM IST
Representative image

Representative image

Kolkata-based ethnic wear heavyweight Vedant Fashions Private Ltd, the owner of top-selling brand Manyavar, has filed draft papers with market regulator Sebi to raise funds via an initial public offer (IPO).

Moneycontrol was the first to report the firm’s listing plans on May 26, 2021. The report had indicated that the IPO was likely to raise around Rs 2,500 crores and would primarily consist of an OFS ( offer for sale ) component to facilitate a partial exit for existing investors.

The Ravi Modi-founded fast-growing apparel company is backed by India-focused private equity firm Kedaara Capital and its other brands include women’s wear brand Mohey, family wear brand Mebaz, Twamev, and Manthan. The widely popular Manyavar brand is a category leader in the branded Indian wedding and celebration wear market.

According to the firm’s DRHP, the issue comprises a pure offer for sale (OFS) of up to 36.36 million shares by its existing promoter and shareholders. The OFS has up to 17.46 million shares by Rhine Holdings Ltd; up to 723,000 shares by Kedaara Capital Alternative Investment Fund-Kedaara Capital AIF I, and up to 18.18 million shares by Ravi Modi Family Trust.

Currently, Rhine Holdings has a 7.2% stake, while Kedaara AIF holds a 0.3% stake. Ravi Modi Family Trust has a 74.67% stake in the firm.


The DRHP states that Vedant Fashions will not receive any proceeds from the offer. The objects of the offer are to (i) achieve the benefits of listing the equity shares on the stock exchanges, and (ii) carry out the offer for sale of up to 36,364,838 equity shares by the selling shareholders. Further, the firm expects that listing of the equity shares will enhance its visibility and brand image and provide liquidity to shareholders, and will also provide a public market for the equity shares in India.

Axis Capital, Edelweiss Financial Services, ICICI Securities, IIFL Securities, and Kotak Mahindra Capital are the investment banks working on the IPO. Khaitan & Co, Cyril Amarchand Mangaldas, and Indus Law are the legal advisors to the company, i-banks & selling shareholders respectively.


According to CRISIL, Vedant Fashions is the largest company in India in the men’s Indian wedding and celebration wear segment in terms of revenue, OPBDIT, and profit after tax for the Financial Year 2020.

As of 30 June 2021, the company had a retail footprint of 1.1 million sq. ft covering 525 exclusive brand outlets (EBOs), including 55 shop-in-shop, spread across 207 cities and towns in India and 12 EBOs across the US, Canada, and the UAE.

The firm aims to double its national footprint over the next few years.

Ravi Modi’s wife Shilpi Modi, a trained fashion designer, is a director of the firm and closely involved with its creative aspects. By 2025, the firm plans to have 15,00,000 square feet of Manyavar retail space, 5,00,000 sq. ft. of Mohey retail space, and 1000 exclusive stores including 250 flagship & 50 global stores at 300 cities across India and abroad.

It is also aiming for a production capacity of 10 million pieces per annum.

For FY21, the firm’s revenue from operations stood at Rs 564.82 crore against Rs 915.55 crore a year ago. Net profit for FY21 stood at Rs 132.9 crore versus Rs 236.63 crore in FY20.

“We intend to focus our expansion effects in markets where we determine there is an increasing demand for our products, and where we can leverage our existing presence to expand our market share. Through our cluster-based expansion strategy, we have identified several cities and towns in both existing geographies where we have a presence and new geographies where we plan to establish our first EBOs," the firm said in the DRHP.


Vedant Fashions does not have a pure play listed peer in the ethnic wear segment but some listed firms in the apparel and clothing segment include Aditya Birla Fashion & Retail, TCNS Clothing, SP Apparels, Zodiac Clothing & VIP Clothing. Incidentally, Aditya Birla Fashion & Retail which counts Flipkart as an investor, has recently struck deals with ace designers Sabyasachi & Tarun Tahiliani with an eye on the ethnic wear segment.

The firm has had a strong association with both cricket and Bollywood. It has sponsored IPL teams Kolkata Knight Riders, Delhi Daredevils, and Sunrisers Hyderabad and roped in movie stars like Amitabh Bachchan, Alia Bhatt, Ranveer Singh for its advertisements & promotional campaigns. Its ad featuring brand ambassador Virat Kohli & Anushka Sharma prior to their high-profile wedding in 2017 had gained immense popularity.


According to CRISIL Research, the ethnic apparel retail market, estimated at approximately Rs 1,800 billion in Financial Year 2020, saw a steep decline of 38% to 40% in Financial Year 2021 owing to the pandemic. However, it expects the ethnic apparel market growth to rebound 48% to 50% on-year in Financial Year 2022 as normalcy returns after the second pandemic wave ends, restrictions on public gatherings ease, and India’s vaccination drive progresses.

“The large wedding market and festivals throughout the year are strong fundamental drivers of the organized ethnic wear market in India for the long term. With long-term growth factors remaining intact and celebrations continuing to drive ethnic-wear sales, the concept of pent-up demand is very relevant in Indian wedding and celebration wear, unlike other consumer categories, therefore driving growth higher,” the firm’s DRHP said. CRISIL Research expects the ethnic apparel industry to grow at a 14% to 15% CAGR over Financial Years 2022 to 2025, reaching Rs 2,350 billion to Rs 2,400 billion by Financial Year 2025.
Ashwin Mohan
first published: Sep 10, 2021 04:53 pm

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