BIBA Fashion Limited IPO Company Profile :
BIBA Fashion Limited is one of the largest lifestyle brands in the women’s Indian wear market in India in terms of market share. Launched in 1986, the flagship brand, BIBA, is a ‘category creator’ in the women’s Indian wear segment benefiting from a rich legacy, a leading market position across the category, and an industry-leading online presence. The company develops, design, source, market and sell a wide portfolio of Indian wear for women and girls across multiple brands, namely the flagship brand, BIBA, and the value fashion brand, Rangriti. The products are specifically tailored for the Indian consumer and, its range of products offers distinct price points for the consumers. Furthermore, the flagship brand, BIBA, has the highest online brand recall amongst Indian wear brands, as of February 2022.
BIBA Fashion Limited IPO Brand portfolio:
-
BIBA: BIBA is a flagship brand and has been a pan-India ‘category leader’ in the women’s Indian wear market for over three decades. This brand provides mid-premium to premium offerings across salwar kameez dupattas, Mix n’ Match wear and Ready-to-Stitch wear, and adjacent product categories, such as jewellery, footwear, wallets, and fragrances are also offered. As of December 31, 2021, BIBA products were offered in 308 EBOs (Exclusive brand outlets) across 130 cities in India.
-
Rangriti: Rangriti is a value fashion brand, it caters to the fashion needs of a wider audience through offerings in salwar kameez dupattas, Mix n’ Match wear and Ready-to-Stitch wear at attractive prices. Within the Rangriti brand, the company has introduced new sub-categories for the customers, including slim pants, indie tops, smart kurtas, and jackets, thereby creating fashion-forward Indian fusion looks that are both unique and affordable. As of December 31, 2021, Rangriti branded products were offered in 119 EBOs in 68 cities in India.
-
BIBA by Rohit Bal: BIBA by Rohit Bal is a premium product range produce in collaboration with acclaimed designer Rohit Bal. This range caters to the premium formal and eveningwear segment
-
BIBA Girls: BIBA Girls is a product range offering Indian wear for girls aged 2-12 including anarkalis, dresses, lehengas, suits, tops, bottom wear, and footwear.
-
Spelle: Spelle was launched in September 2021 in 162 of the company’s EBOs and website, biba.in. This fragrance has found success amongst consumers and has sold over 5,900 units since its launch until December 31, 2021.
BIBA Fashion Limited IPO Financial Analysis:
| Particulars | 9M FY-22(in cr.) | FY-21(in cr.) | FY-20(in cr.) | FY-19(in cr.) | CAGR |
| Revenue | 487.68 | 525.82 | 757.20 | 729.40 | -10.3% |
| Cost of good sold | 179.79 | 221.64 | 249.33 | 248.41 | |
| Empl. Cost | 65.53 | 71.34 | 111.43 | 93.34 | |
| Other exp | 157.66 | 170.3 | 260.45 | 257.74 | |
| EBITDA | 84.70 | 62.54 | 135.99 | 129.91 | -21.6% |
| EBITDA M% | 17.37% | 11.89% | 17.96% | 17.81% | |
| Depreciation | 57.63 | 83.39 | 80.92 | 71.67 | |
| Interest | 29.49 | 43.04 | 44.98 | 35.37 | |
| PBT | -2.42 | -63.89 | 10.09 | 22.87 | -240.8% |
| Total tax | 6.86 | -8.93 | 5.12 | 8.75 | |
| PAT | -9.28 | -54.96 | 4.97 | 14.12 | -257.3% |
| Dep./revenue% | 11.82% | 15.86% | 10.69% | 9.83% | |
| Int./revenue% | 6.05% | 8.19% | 5.94% | 4.85% |
BIBA Fashion Limited Brand Revenue and % Share:
| Segment | 9M FY-22(in cr.) | % | FY-21(in cr.) | % | FY-20(in cr.) | % | FY-19(in cr.) | % |
| BIBA | 431.88 | 88.56% | 462.55 | 87.97% | 666.20 | 87.98% | 642.96 | 87.79% |
| Rangriti | 55.79 | 11.44% | 63.26 | 12.03% | 91.00 | 12.02% | 89.43 | 12.21% |
| Total | 487.67 | 100.00% | 525.81 | 100.00% | 757.20 | 100.00% | 732.39 | 100.00% |
BIBA Fashion Limited IPO Revenue from Distribution Channels:
| Segment | 9M FY-22(in cr.) | % | FY-21(in cr.) | % | FY-20(in cr.) | % | FY-19(in cr.) | % |
| EBOs | 191.15 | 39.20% | 183.78 | 34.95% | 352.73 | 46.58% | 323.00 | 44.28% |
| LFSs | 118.45 | 24.29% | 125.63 | 23.89% | 261.29 | 34.51% | 256.19 | 35.12% |
| Online | 164.79 | 33.79% | 194.73 | 37.03% | 110.61 | 14.61% | 114.52 | 15.70% |
| Others(MBOs) | 13.28 | 2.72% | 21.67 | 4.12% | 32.56 | 4.30% | 35.67 | 4.89% |
| Total | 487.67 | 100.00% | 525.81 | 100.00% | 757.19 | 100.00% | 729.38 | 100.00% |
BIBA Fashion Limited IPO Strengths:
-
Leading market position and strong brand equity across a diverse set of consumers across the value chain the flagship brand BIBA has the highest brand recall amongst women’s Indian wear brands, as of February 2022, which contributed to the growth in consumer base.
-
Diversified pan-India multichannel distribution with a strong foothold on both offline and online channels. In the period from 2018 to 2022, the EBO rollout CAGRs of 6% and 27% for BIBA-and Rangriti-branded EBOs, respectively, is the highest compared to the company’s peers, and the total number of EBOs is amongst the highest in the women’s Indian wear segment. For the financial year 2021, 37.03% of the revenue from operations was generated from online channels, of which 11.55% was from the company’s own website, BIBA.in, and 25.49% from third-party online marketplaces such as Myntra, Amazon, Flipkart, Nykaa and Tata Cliq.
-
Capital-efficient and scalable retail model to capitalize on the strong industry growth profile driven by a rapid shift towards organized retail and increasing online penetration. The apparel market in India is expected to grow at a CAGR of 22.4% between the financial year 2021 and the financial year 2025. The women’s apparel market is expected to outgrow other major segments of this market, such as menswear and kidswear, wear due to positive demographic shifts, including an increase in the number of working women. It is expected to be the fastest-growing segment in the apparel market in India, with a forecasted growth rate of 9.2% between the financial year 2020 and the financial year 2025.
-
A ‘digital first’ approach is an increasingly critical driver of growth across many consumer categories in India, as well as globally, with millennial and generation Z demographic segments now entering the workforce and driving digitization as active adopters of technology and digital media. For the financial year 2021 and the nine months ended December 31, 2021, approximately 04% and 33.79% of our revenue from operations was generated through online channels, which is superior to our peers in the women’s Indian wear segment
BIBA Fashion Limited IPO Risk Factors:
-
The business is highly concentrated on women’s Indian wear apparel and is vulnerable to variations in demand and changes in consumer preferences, which could have an adverse effect on the business, results of operations, and financial condition.
-
BIBA Fashion Limited has incurred losses in the past and may incur losses in the future. The ability to operate profitably depends upon a number of factors, some of which are beyond its control.
-
The industry is competitive in both the offline and the rapidly-growing online channels, with the potential to adversely affect its pricing ability and disrupt its sales. Its inability to compete effectively may adversely affect the business, cash flows, and results of operations.
-
Lockdowns and restrictions in India due to the COVID-19 pandemic have accelerated the growth in the number of online shoppers in India, and the company witnessed a 76.05% growth in sales from online channels between the financial year 2020 and 2021, any decrease in revenues or sales from any one of the key online marketplaces may adversely affect the business, cash flows, results of operations and financial condition.