S Kumars Nationwide Ltd (SKNL), the countrywide textile conglomerate, is betting big on the casual wear business in the luxury segment through its newly formed subsidiary, Reid & Taylor India Ltd. The company is all set to launch luxury brands in men and women casual wear segments soon in India under the brand name, Reid & Taylor.
As part of the expansion, the number of exclusive Reid & Taylor outlets will be increased to 300 from the current 160 stores by the end of fiscal 2008-09. Also, to meet the funding, Reid & Taylor India Ltd plans to dilute 10-20% stake to private equity (PE) players in a couple of months.
The luxury textile business of SKNL has contributed 24% or Rs 409 crore out of the total sales in 2007-08, registering a domestic sales of Rs 380 crore. For the year 2008-09, SKNL projects sales of Rs 650 crore from Reid & Taylor India Ltd. India?s textiles and apparels industry is estimated to be worth $49 billion.
Anees Fazalbhoy, director, business strategy, SKNL, told FE , ?We will have our focus on luxury brands as enormous growth is taking place in the luxury segment in India. Nowadays, people are ready to spend sufficient amounts for luxury brands and we wanted to utilise the situation well for our future prospects.? For this, Reid& Taylor?s manufacturing plant at Mysore has increased capacity to 84 lakh meters from 48 lakh meters/annum.
On stake dilution, he said, ?We are in talks with a couple of PE players in the US as part of off loading 10-20% stake. However, we are yet to reach a final decision on the valuation of the subsidiary. He said that there is no immediate plan for an initial public offer (IPO) for Reid & Taylor subsidiary.
Meanwhile, SKNL has fixed May 2 as the record date for de-merger of its retail arm Brandhouse Retails. The shares allotted will be in the ratio of one share for every five shares held in SKNL.