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ICICI Venture Sells 10% In Subhiksha To PremjiInvest For Rs 230 Crore

05 September, 2008

ICICI Venture has sold a 10% stake in retail chain Subhiksha Trading Services to Azim Premji’s private equity firm PremjiInvest for Rs 230 crore, reports NDTV Profit, quoting sources. ICICI Venture holds about 25% in Subhiksha, afyer the sale the PE fund’s stake in the retail company will come down to 15%.

This will be second time ICICI Venture selling its stake in the Chennai-headquartered retail chain. A year ago, ICICI Venture had reportedly sold a 5 per cent stake to ICICI Prudential Mutual Fund for an estimated Rs 75 crore.

This had brought down ICICI Venture’s shareholding in the company to 25%.

ICICI Venture had taken a 10% stake in Subhiksha in July 2000, which was increased in 2004 after another round of funding of Rs 25 crore. Subhiskha was started in March 1997 in Chennai. It now has about 1,000 retail stores operating in four verticals namely fruits and vegetables, pharmaceuticals, FMCG and telecom.

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sunil doshi . 6 years ago

well i feel its a great exit by ICICI…..kudos…..just look at return in investment….and YES premjiinvest has no track record…..has been sold the idea by a smooth talking investment banker……they invested in a few listed stocks too…i think they are down abt 50% in 1 yr…..a classic case of hyped fund managers getting naked in a bear market…..and PREMJI uncle is too rich to care……rather than living a austere lifestyle…he can pt money into better new ideas and make multibagger returns…….GIVING exits to cash strapped retail chains is not a great style….and yes secretly ever visit a unknown subhiksha in any corner of BOMBAY…………it stinks….would never buy aything from there…its for zhopadpatti guys

Jiten . 6 years ago

Though Subhiksha caters to a different customer segment and has a different positioning in the market, “mere presence and numbers of stores (the count) does not justify the valuation”.

I do not deny the potential though..Kudos Mr. Premji

The biggest drawback as I see are:

– Lack of inventory

– options/variety in an item segment

– SKUs

– Buying or POS experience

– Customer commitment

the list can go on….

Hoping for huge improvement with the interest shown by stalwarts like Mr. Premji’s.

I do remember ICICI’s interest in Trinethra chain and its early exit (would not like to get into day to day management & its quality though).

However would like to applaud ICICI’s contribution as a VC for long time now.

All the very best

amit . 6 years ago

Though they are the biggest retail chain in India today it is the core management that is to be blamed for the mess they are into today. It is widely spread news in the market regarding the problems that they facing to procure the inventories. Many times there isin’t many items to purchase & they even at times do not have plastic bags to give to the customers. Is this the position of the company that they can’t afford to give a mere plastic bag to the customer

ICICI Venture Sells 10% In Subhiksha To PremjiInvest For Rs 230 Crore

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