Advent International, a global private equity fund, is set to purchase women’s innerwear maker Enamor for an enterprise value of around Rs 900-1,000 crore.
Given India’s fast-growing category of innerwear, Advent is attempting to build a full platform in this business line as it already owns a controlling interest in Dixcy Textiles, men’s innerwear manufacturer.
“The agreement was signed and it is probable that an announcement will follow soon,” an individual with direct development expertise said. Enamor’s current early supporters— India Alternatives and Faering Capital — are going to get an exit.
The parent company, Gokaldas Intimatewear, is also likely to take an exit entirely through this agreement. The business has a Rs 300 crore plus topline and is valued at an enterprise value of approximately Rs 1,000 crore.
Dollar Industries is presently trading at a market cap of Rs 1,060 crore with a topline of Rs 1,029 crore. Lux Industries is valued at Rs 3,024 crore, with a turnover of Rs 1,207 crore.
In the last couple of years, the innerwear category has seen unprecedented brand traction and structured retail play. Advent International had purchased a significant stake in Dixcy for around Rs 700-800 crore in 2017.
Dixcy based in Tiruppur, which operates under the brand name of the flagship Dixcy Scott, was established in 1982 by Prem Prakash Sikka. The business also sells casual wear in India as well as in West Asia and Singapore, such as track pants, shorts, and polo t-shirts.
This comes as a great opportunity for Advent International to create customer-centric business through this platform. Acquisition of Dixcy caters to the need for men’s innerwear needs and with this take, the gap of women’s innerwear will be filled.
In India, Advent International looked at mostly regulated deals. Its portfolio currently involves Dixcy Textiles, Quest Global Services, Crompton Greaves, Manjushree Technopack, and Ask Investment Advisors.
The Indian innerwear market provides a chance for the industry to consolidate. Enamor, started in 2003, has approximately 4,500 sales points and also sells through its own e-commerce portal. Technopak Advisors pegged the innerwear sector in a study for 2014 to expand to Rs 68,270 by 2024.
The report highlighted, “The market for women’s innerwear, driven by value-added innerwear goods, adds to the market by around 60%. This market is worth Rs 12,510 crore (in 2014) and grows at a promising 15% CAGR. This development has been driven by the increasing amount of working women and the enhanced share of western wear in their wardrobe. Furthermore, with the increase in exposure, the demand for better fits and quality is increasing alongside the demand for a wider range of colors, styles, and accessories, ”