Aditya Birla Fashion and Retail
Unlocking Value Through Madura Business Demerger:
Aditya Birla Fashion and Retail Limited (ABFRL) stands as India’s largest pure-play fashion and lifestyle company, boasting an impressive portfolio of leading fashion brands and retail formats. Let’s dive into the details:
About Aditya Birla Fashion and Retail
- Background: ABFRL emerged after the consolidation of the branded apparel businesses of the Aditya Birla Group. This consolidation brought together two iconic Indian fashion giants: Madura Fashion & Lifestyle and Pantaloons.
- Retail Space: With a retail space spanning 10.8 million sq. ft. (as of March 31, 2023), ABFRL is a force to be reckoned with in the Indian fashion industry.
- Brands: ABFRL houses an elegant bouquet of established fashion brands, each with its unique identity:
- Louis Philippe: A name synonymous with sophistication.
- Van Heusen: Known for its timeless style.
- Allen Solly: Casual chic for the modern individual.
- Peter England: Trusted for over 25 years.
- The Collective: India’s largest multi-brand retailer of international brands.
- Reebok: Sportswear excellence.
- And many more!
Strategic Moves
ABFRL has made strategic moves to enhance its brand portfolio:
- Christian Louboutin Partnership: ABFRL joined forces with Christian Louboutin, renowned for high-end footwear and iconic soles.
- TCNS Clothing Acquisition: ABFRL acquired a 51% stake in TCNS Clothing, home to brands like W, Aurelia, and Wishful.
- Galeries Lafayette Partnership: A strategic alliance with the globally renowned brand.
- House of Masaba: ABFRL acquired a majority stake in House of Masaba Lifestyle Private Limited.
- Designer Collaborations: Partnerships with designers such as Tarun Tahiliani and Sabyasachi Couture.
Vision and Values
- Vision: ABFRL aims to passionately satisfy Indian consumer needs in fashion, style, and value across wearing occasions.
- Values: Seamlessness, Passion, Speed, Commitment, and Integrity drive ABFRL’s operations.
Financial Strength
- Revenue: ABFRL’s revenue stands at Rs. 12,418 Cr. (as of March 31, 2023).
- Global Footprint: Over 50% of ABFRL’s revenues come from overseas operations across 41 countries.
Aditya Birla Fashion and Retail: Unlocking Value Through Madura Business Demerger
Aditya Birla Fashion and Retail (ABFRL) recently made a significant announcement regarding the demerger of its Madura Fashion and Lifestyle Business (MFL). This strategic move aims to unlock value, streamline operations, and enhance growth prospects for both entities. Here’s what you need to know:
Key Features of the Demerger
- Vertical Demerger: The demerger involves a vertical split of Madura Fashion and Lifestyle business from ABFRL.
- Distinct Capital Structures: Post-demerger, both ABFRL and ABLBL will have their own distinct capital structures, allowing them to pursue independent growth trajectories.
- Listed Separately: ABLBL will be listed as a separate entity on completion of the demerger process.
Shareholder Benefits
- Identical Shareholdings: Existing shareholders of ABFRL will receive one share of ABLBL for every one share in ABFRL, ensuring identical shareholdings in both companies.
- Unlocking Value: The demerger is expected to unlock significant value for ABFRL shareholders by allowing them to participate in the growth of both entities.
Business Portfolio of Aditya Birla Fashion and Retail
- ABLBL will house several lifestyle brands, including:
- Louis Philippe
- Van Heusen
- Allen Solly
- Peter England
- Casual wear brands like American Eagle and Forever 21
- Sportswear brand Reebok
- Inner-wear business under the Van Heusen brand
Financial Implications
- Within 12 months of the demerger, ABFRL plans to raise Rs 2,500 crore in equity capital to strengthen its balance sheet and support the growth of its remaining businesses.
- ABFRL’s Q3 results showed a consolidated net loss of Rs 107.60 crore, compared to a net profit of Rs 11.21 crore in the year-ago period. However, revenue grew by 16 percent to Rs 4,166.71 crore.
Financials of Madura Fashion and Lifestyle Business (MFL)
The turnover of the MFL Business of the Demerged Company as on March 31, 2023, was Rs. 7,607 crores and forms 64.81 % of the total standalone turnover of the Demerged Company as on March 31, 2023.
The Company runs a diverse portfolio of fashion brands and retail formats with key business segments comprising of
- Madura Fashion and Lifestyle and Pantaloons, Ethnic portfolio along with other new growth platforms.
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