ASK Pravi Private Equity Opportunities Fund, a fund managed by ASK Pravi Capital Advisors Pvt Ltd, has picked a significant minority stake in Chandigarh-based kidswear manufacturer Indian Clothing League Pvt Ltd for Rs 50 crore ($8.08 million).
This is the first time that Indian Clothing League has raised external funding and it will enable the firm to grow its two existing brands – 612 Ivy League and Baby League – by spreading its retail footprint, widening its distribution network, strengthening its brand equity and expanding manufacturing capacity. 612 Ivy League focuses on pre-teen children while Baby League is a brand for infants and toddlers.
As part of the deal, Jayanta Banerjee and Anand Vyas, managing partners of ASK Pravi Capital Advisors, will be joining the board of directors of Indian Clothing League.
Incorporated in 1987 and promoted by husband-wife duo Manu and Mohita Indrayan, Indian Clothing League retails its product through large format multi-brand stores such as Shoppers Stop, Reliance Retail and Globus and via e-commerce players such as Jabong and Flipkart, through 275 sale points across more than 80 cities. The firm has its manufacturing facilities in Ludhiana with a capacity of 100,000 garments per month.
“There is a huge gap in the Indian kids wear market for high quality yet affordable products. The company seeks to fill this gap by providing contemporary styled products at affordable prices for today’s children. The investment from ASK Pravi will help the brands build a presence across the length and breadth of the country and develop a strong connect with our customers. It will help us scale up our manufacturing and retail operations," said Manu Indrayan.
"Over a very short period of time Manu and Mohita have built a high quality kids wear business and have gained the confidence of top national retailers like Shoppers Stop, Reliance Trends, etc. Both brands - 612 Ivy League and Baby League - are strong value propositions. We look forward to partnering with them in building the business to the next level," said Anand Vyas, managing partner, ASK Pravi Capital Advisors.
"Fast growing businesses in non-metro urban clusters like Ludhiana-Chandigarh have been a key focus area of our fund and this investment is a demonstration of the same," Jayanta Banerjee, managing partner, ASK Pravi Capital Advisors, said.
Ourea Capital Advisors acted as the sole financial advisor to Indian Clothing League for this transaction. Tatva Legal acted as the legal advisors to ASK Pravi and Ernst & Young conducted the financial and accounting due diligence for the transaction.
In the kids wear space, previously, Lilliput had raised PE funding, but had a bitter spat with its investors who later wrote off their investment.
ASK Pravi follows the domestic consumption growth theme as part of its investment strategy and focuses on unlisted small and medium sized businesses.
This is the second investment made by the PE fund, which is backed by domestic family offices, in the last six months. Last August it invested $9.8 million (Rs 60 crore) in Hyderabad-based Omni Hospitals for a significant minority stake.
(Edited by Joby Puthuparampil Johnson)