Stanley Lifestyles Ltd, a Bengaluru-based maker of luxury furniture and home décor products, has raised its first round of institutional equity funding from the Oman India Joint Investment Fund.
The mid-market private equity firm co-sponsored by State Bank of India and State General Reserve Fund of Oman has picked a stake of about 26% in the company for $24 million (Rs 170 crore), two people aware of the development said.
About two-thirds of the total amount is primary equity infusion while the remaining is for giving a partial exit to an early investor and the company's founders, the people said.
The company and OIJIF declined to comment on the funding details.
Separately, Stanley said in a statement it will use the funds to expand its retail footprint, expand capacity, meet working capital requirements and pursue acquisition opportunities. It didn't disclose any details.
Sunil Suresh, managing director at Stanley, said the company will benefit from OIJIF's experience, especially in the retail sector, to improve its position in the premium home furnishing industry.
Srinath S, CEO at OIJIF, said: “This investment aligns with OIJIF’s strategy to invest in leading Indian consumer businesses having a strong brand recall. Stanley is an esteemed brand in premium home furnishing market and a trusted vendor in automotive seating segment."
The company plans to double the capacity and expand to new markets such as the Middle East and Australia, one of the persons cited above said.
Founded in 1996 by Suresh and his wife Shubha Sunil, Stanley operates 16 retail outlets and design studios across the country. It plans to increase the number of stores to 40.
The company sells home accessories under its own label Stanley and licensed international brands such as Lazboy and Stordal. It is also a global vendor to Swedish furniture giant IKEA for the supply of sofas, the company statement said.
The company also provides leather seating products to automobile manufacturers in India such as Toyota, Ford, Mahindra & Mahindra, Renault and Nissan.
According to a December 2017 credit rating report, Stanley Lifestyles owns about 98.5% of its subsidiary Stanley Retail Ltd. While the parent company makes leather-based furniture and leather car seat covers, the unit operates the retail chain.
The company has seen its revenue grow over the years. It reported total income of Rs 160 crore for the year through March 2017, according to VCCEdge, the data research arm of VCCircle.
In 2017-18, the company reported revenue of Rs 210 crore and expects to increase the top line to Rs 300 crore in 2018-19, one of the persons cited above said.
OIJIF had recently announced the second close of its second fund, OIJIF II, with commitments of $230 million. Stanley is the third investment from OIJIF II, after non-bank lender Annapurna Finance and auto-parts maker Divgi-TTS.
ICICI Securities Ltd was the financial adviser to Stanley for the transaction.