Global private-equity fund Advent International is all set to acquire women’s innerwear maker Enamor for an enterprise value of around Rs 900-1,000 crore. Given the fast-growing innerwear category in India, Advent is trying to create a complete platform in this line of business as it already owns a controlling stake in men’s innerwear maker Dixcy Textiles.
“The deal has been signed and an announcement is likely soon,” said a person with direct knowledge of the development. The existing early backers of Enamor — India Alternatives and Faering Capital — will get an exit. “The two PE investors in Enamor are likely to get around two times the return on their investments,” said the market source.
Gokaldas Intimatewear, the parent company, is also likely to exit completely via this deal. The company has a topline of Rs 300 crore plus and is being valued at an enterprise value of around Rs 1,000 crore, sources said.
Advent International and Enamor did not respond to ET’s questions on the deal.
Dollar Industries, with a topline of Rs 1,029 crore, is currently trading at a market cap of Rs 1,060 crore. Lux Industries, with a turnover of Rs 1,207 crore, is valued at Rs 3,024 crore.
The innerwear category has seen unprecedented traction for brands and an organised retail play in the last few years. Advent International had acquired a significant stake in Dixcy for around Rs 700-800 crore in 2017.
Tiruppur-based Dixcy, which sells under the flagship Dixcy Scott brand name, was founded by Prem Prakash Sikka in 1982. The company also sells casual wear, such as track pants, shorts and polo t-shirts, in India as well as West Asia and Singapore.
“For Advent, this is a great opportunity to build a consumer business through this platform. Through Dixcy, it looked at catering to the men’s innerwear needs and with this acquisition, the gap of women’s innerwear too is filled,” said a banker with knowledge of the development.
Advent International has been looking at mostly controlled deals in India. Currently, its portfolio includes Dixcy Textiles, Quest Global Services, Crompton GreavesNSE 4.96 % Consumer Electricals, Manjushree Technopack and Ask Investment Advisors.
The Indian innerwear market offers an opportunity for consolidation in the sector. Enamor, which was launched in 2003, has around 4,500 points of sale and also sells through its own e-commerce site. In a 2014 report, Technopak Advisors pegged the innerwear industry to grow to Rs 68,270 crore by 2024.
“The women’s innerwear market, which is driven by value-added innerwear products, contributes around 60% to the market. This market is worth Rs 12,510 crore (in 2014) and is growing at a promising CAGR of 15% percent. The growing number of working women and the increased share of western wear in their wardrobe have propelled this growth. Further, with the increase in exposure, there is an increased demand for better fits and quality alongside the demand for a wider range of colours, styles, and accessories,” the report highlighted.
Source: Economic Times