Mufti attracts Rs 250 cr funding from Carlyle

As speculated earlier, US-based private equity firm Carlyle Group is said to be in advanced talks with

Credo Brands Marketing to acquire 35 percent stake at about Rs 200-250 crores in men’s casual brand Mufti. The investment is said to be awaiting the Foreign Investment Promotion Board (FIPB) approval.

Incepted in 1998, Credo Brands reported revenues of Rs 235 crores in fiscal 2013 and expects sales of nearly Rs 280 crores this fiscal year ending March 31, 2014. The company’s product consists of shirts, jeans, T-shirts, sweatshirts, sweaters and jackets, which is retailed at over 200 stores and 1,200 large format stores such as Shoppers Stop, Lifestyle and Central.

Of late, many PE investors are showcasing keen interest in Indian apparel brands. For instance, Kishore Biyani’s Future Group divested its stake in brands like Biba to Warburg Pincus and Faering Capital at an investment of Rs 300 crores, and And India to General Atlantic at an undisclosed amount, clocking in returns almost 24-times its initial investment. Other examples include women's ethnic wear brands 'Jashn' and 'Bawree' that have initiated talks with a host of private equity investors. Ethnic-wear brand Soch is in the process of appointing an investment bank to scout for investors and women's formal-wear brand Chemistry has signed a term-sheet with a PE firm to raise Rs 40-50 crores.

In 2012, L Capital and PremjiInvest bought a stake in Fabindia Overseas and currently, Avigo Capital Partners is in talks with PE firms to sell its majority stake in casual wear company Spykar Lifestyles. However, experts feel that though investments would continue to trickle in, the apparel space is unlikely to see blockbuster deals until macro-economic conditions improve.