Fabindia Plans to File for IPO worth Rs 7,400 Cr

Fabindia, which is already a household name in ethnic wear and local arts and crafts, is looking at an IPO to raise close to $1 billion or approximately Rs.7,400 crore. The IPO will be a mix of a fresh issue and an offer for sale. Reportedly, Fabindia has already shortlisted I-Sec, SBI Caps, JP Morgan, Credit Suisse and Nomura Advisory as their investment banks to lead manage their public issue.

While the specifics of the issue are not yet available, it is estimated that Fabindia could look at an overall valuation for the business at $2 billion. Out of this, 25% of the shares or nearly $500 million could be an offer for sale or OFS while another $500 million may come from fresh issue, leading to infusion of funds into the company. 

At Rs.7,400 crore, this will be among the largest issues in recent times. The only issue this year that was larger was Zomato which raised Rs.9,375 crore via its public issue in July this year. The other large issue was Nuvoco Vistas which was worth Rs.5,000 crore. Of course, there is the Paytm IPO that will be close to Rs.16,000 crore and the biggest of them all, LIC, which is expected to be a Rs.75,000 crore issue.

Fabindia counts Premji Finvest, the family office of Azim Premji, as well as Nandan Nilekani and Rohini Nilekani among its current equity investors. While it is almost confirmed that Premji Finvest may look at a partial exit in the OFS, it is not clear what the Nilekani family proposes to do with its stake.

Fabindia sells wares of over 40,000 artisans and craftsmen across the length and breadth of India. They have a large number of dedicated stores across India through which these ethnic products are reached out to the public. Fabindia plans to use the fresh funds to expand its store presence. IPOs have already raised close Rs.60,000 crore this year across a total of 36 public issues. 
 

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