“The offer comprises a fresh issue of up to Rs 500 crore and an offer for sale of 25,050,543 equity shares by existing investors/ shareholders,” according to the draft red herring prospectus (DRHP) filed with the market regulators on Saturday.
The New Delhi-based retailer has investments from Azim Premji’s firm PremjiInvest.
The company has submitted its DRHP to raise money from the markets at a valuation of more than Rs 20,000 crore, one person familiar with the plans said. A Fabindia spokesperson declined to comment.
ICICI Securities, Credit Suisse Securities (India), J.P. Morgan India, Nomura Financial Advisory and Securities (India), SBI Capital Markets and Equirus Capital are the book running lead managers to the issue.
The selling shareholders apart from promoters Bissell family members also include PremjiInvest, Bajaj Holdings and Kotak India Advantage Fund among other investors.
The six-decade-old Fabindia runs more than 300 Fabindia-branded outlets and more than 70 Organic India stores nationwide and the New Delhi-based retailer sources products from over 2,200 farmers directly and deals with over 10,300 farmers through their associates.
“In order to reward and express gratitude to certain artisans and farmers engaged with the company or its subsidiaries, certain of Fabindia’s promoters, namely, Bimla Nanda Bissell and Madhukar Khera, pursuant to their letters each dated January 14, 2022, respectively intend to transfer 400,000 equity shares and 375,080 equity shares,” according to the company’s DRHP.
Fabindia is the latest among a host of retailers including GoColors and Biba that have either tapped the markets or targeting their IPOs later this year.
In November, Go Fashion (India) Ltd’s, that owns women’s bottom-wear brand Go Colors, IPO was oversubscribed 135 times. Go Fashion listed at 90% premium to its issue price. Fabindia’s rival Biba, that counts Warburg Pincus and Faering Capital among its investors, is also planning for an IPO later this year, ET had reported.
Fabindia’s filing for an IPO comes at a time when retailers are reeling under low sales and dwindling footfalls in stores amid a raging third wave of Covid-19 nationwide.