Multiples invests $110m in India's Arvind

Multiples will take a 10% stake in Arvind Fashions, according to a filing, valuing the subsidiary at INR80 billion. The GP is already an investor in the parent company, having paid INR1.5 billion for a 3.8% interest in 2014. Arvind expects the new commitment to provide financial reinforcement for its future growth initiatives.

India's apparel market was estimated to be worth about $52 billion in 2015, and is expected to keep growing due to factors such as increased urbanization and a rising population of young professionals. Arvind notes that in China the growth in apparel consumption accelerated significantly in 2005 when per capita GDP crossed $2,000, a threshold that India is expected to reach this year.

In 2015 branded apparel accounted for 29% of the overall apparel market, a figure that is projected to increase to 34% by 2021. Arvind Fashions believes it is well positioned to take advantage of this growth due to its portfolio of international brands, including Tommy Hilfiger, Gap, Aeropostale and Hanes. It has more than 45,000 square feet of floor space in shopping malls across India and partners with various e-commerce companies as well.

In its most recent annual report, Arvind recorded revenue for the entire company of INR55 billion for the year ended March 2016, up from INR5.4 billion in 2015. Over the same period profit dropped from INR4.8 billion to INR4.5 billion.

Multiples' investment came from its second India-focused fund, which closed earlier this year at $690 million. The vehicle comprises a core fund of $550 million and a co-investment pool of $135 million, and seeks growth capital commitments in mid-tier Indian companies with the goal of helping them scale into national or regional leaders.

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• Topics
• South Asia
• Consumer
• PIPEs
• India
• Multiples Alternative Asset Management