TCNS Clothing Co. Ltd – a Women’s Branded Apparel Company with a brand portfolio comprising: ‘W’, ‘aurelia’ and ‘Wishful’ — proposes to open its ‘Initial Public Offering’ (IPO) of 15,714,038 Equity Shares at a price band of Rs 714 to Rs 716 per Equity Share from July 18 to July 20, 2018. The Equity Shares are proposed to be listed on BSE and NSE.
Anant Kumar Daga, Managing Director, told media here today that the company’s future strategies included: Expanding its physical retail and online presence: Leveraging marketing initiatives to increase brand recognition; expanding and strengthening its brand portfolio; Increasing the range of its products under existing brands and improving operational efficiencies.
Replying to questions, he said “We have come under a higher tax regime, while also troughs and peaks occur in our type of business. While a wider base of expertise and wider set of suppliers are needed in our business, we buy all our raw materials and give them to the job work. However, the payback is extremely fast (where we are involved in high-rent areas).”
About suppliers, Daga said the company’s largest supplier is a ‘Mill’ in the NCR, besides 5-7 top suppliers being among the 50-odd percentage of their suppliers. “We have no investment support but – time to time – we extend our capital support,” he said, adding “Western wear is a challenge in women’s wear, but I am not sure if we will go there as there exists opportunity and scope for Indian western wear with its own, unique fits.”
Venkatesh Tarakkad, Group-Chief Financial Officer said the company’s expenses included 11% towards rent, 5%-6% towards marketing expenses, 5%-6% towards freight outwards expenses and so on, while CAPEX has its main portion going towards exclusive brand outlets.
The Apparel and accessories category in estimated to be US$ 56 billion in Fiscal 2017 — of which organized market was US$ 13.7 billion – and is expected to grow to US$ 120 billion by 2025. Indian apparel accounts for 6.6% of the total men’s apparel market (at US$ 21.2 million), and 70.6% of the total 19.3 billion women’s apparel market (at US$ 13.7 billion) in Fiscal 2017.
However, women’s wear portion of Indian apparel accounts for approximately 90% share of the overall Indian apparel market in India. For Indian women, Indian and ethnic fashion has a mainstream need for daily apparel use, whereas for men it is currently largely restricted to occasions apparel like weddings and festivals.
The spend of apparel in India is US$ 38 billion in Fiscal 2017 and is expected to increase to US$ 66 billion by Fiscal 2025. The women’s apparel market in India is US$ 19 billion – as of Fiscal 2017 – and is expected to reach US$ 42 billion by Fiscal 2025.
The key drivers of Ethnic apparel include: women performing multiple roles that allow modern women the flexibility to mediate the balance between work and home life; increasing ethno-centricity (Ethnic apparel has transitioned from being traditional to everyday apparel; brands have identified the transition and offer products positioned across occasions; Shift in usage and fashion trends has caused Ethnic apparel to become more acceptable among the younger generation. Brands are targeting younger generations by positioning ethnic apparel as affordable, comfortable and contemporary fashion; Increasing independence; by 2021 the population of career women in India is expected to reach 45 to 50 million. A rise in the working women population is expected to increase affluence levels of families in urban cities, and thus an increase in spending is also expected; Value branding: large format players have tapped into the need gap in Ethnic apparel by offering their own private labels, which offers convenient shopping of value products at popular price segments; and ‘Fits’ conforming to Indian body types.