Warburg Pincus-backed Biba Apparels picks bankers for 2022 IPO

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Delhi based Biba Apparels, which is backed by Warburg Pincus and Faering Capital, has shortlisted advisors for its proposed initial public offer as the ladies ethnic wear fashion label looks to join a growing list of peers backed by private equity firms eyeing a public market debut, people in the know told Moneycontrol.

“Investment banks JM Financial, HSBC Securities, DAM Capital, and Ambit Capital have been engaged recently by Biba Apparels for its proposed IPO in 2022 through which it is looking to raise around Rs 1,500 crore to Rs 2,000 crore,” one of the persons cited above said.

A second person added that the IPO was likely to be a combination of primary and secondary issuance of shares and would help to raise growth capital and facilitate a partial exit for the private equity investors, Warburg Pincus and Faering Capital.

A third person said that the firm planned to file its draft red herring prospectus with Sebi during “Q1 of the current calendar year”.

All the three persons above spoke to Moneycontrol on the condition of anonymity.

Moneycontrol is awaiting a response from Biba Apparels and JM Financial. This article will be updated as soon as we hear from both firms. HSBC Securities, DAM Capital, and Ambit Capital, however, declined to comment.

Sequoia Capital-backed women’s bottom-wear brand Go Colours raised Rs 1,014 crores via its IPO and made a stellar debut on the bourses in November, listing at a 90 percent premium to its issue price.

Others like Manyavar owner Vedant Fashions ( backed by Kedaara Capital) and FabIndia ( backed by PremjiInvest & Lighthouse Funds) are also preparing for an IPO.

Aditya Birla Fashion & Retail and TCNS Clothing are other key listed players in the apparel and clothing segment and their stock prices have seen a healthy rise in the past six months.

Back in December 2013, in what was then the biggest private equity investment in the Indian ethnic wear market, Warburg Pincus and Faering Capital pumped in Rs 300 crores in Biba Apparels, giving an exit to Future Lifestyle Fashions.

Commenting on the rise of IPO candidates in the segment, Gaurav Marathe, Managing Director, Lincoln International ( India) said, “ Fashion brands are amongst the more difficult consumer businesses to build, but they come with the most defensible moats."

"Mature IPO cycles throw the best opportunity to value fashion brands, given their long-term value creation potential. Now that the robustness of the current IPO cycle has been tested with several unique consumer businesses, it probably is the best time for fashion brands to hit the market,” he added.

THE STORY OF BIBA

Designer turned entrepreneur Meena Bindra founded Biba (a synonym for pretty women in Punjabi) Apparels Private Ltd in 1988. She has been conferred with the Lifetime Achievement Award by CMAI (Clothing Manufacturer’s Association of India) for her contribution to the apparel industry.

BIBA has entered the jewelry and footwear segments and has also made a foray into the fragrance vertical with the launch of a brand called Spelle.

The brand which is available across more than 120 cities, recently opened its 300^th store in Jaipur and also has a presence in major retail chains like Shopper’s Stop, Lifestyle, Pantaloons, and Central. In 2014, the firm bought a 26.66% stake from couturier Anju Modi in her company Anjuman Brand Designs.

In an interview to the Financial Express dated November 12^th, 2021 (when the firm had 296 stores), Siddharath Bindra, the MD of Biba Apparels said the firm would be looking at tier ii and tier iii cities for expansion and  planned “to add 200 stores over the next three years”.

He added, “the share of e-commerce sales has gone up by 20-25% in the past 17-18 months. We expect online sales to go up to 30-35% in the next two to three years. We have sharpened our focus on e-commerce as it provides the convenience of contactless delivery.”