Cantabil to raise Rs 105 crores through IPO

Cantabil Retail has announced that it has received a green signal for launching an initial public offering (IPO). They are currently in the process of updating the document. Vijay Bansal, Chairman and Managing Director, Cantabil Retail India says, “Once the updation is over, we plan to launch

the issue. We have not yet zeroed in on any particular entity. However, discussions are on with reputed entities in the market. Anchor investors will be finalized before opening the issue.”

An IPO is when a company issues common stocks or shares to the public for the first time. Cantabil plans to raise Rs 105 crores from the market through this IPO. “We plan to use the IPO funds for establishing an integrated manufacturing facility at Bahadurgah, expansion of our retail network and repayment of debt, besides augmenting the working capital,” avers Bansal. Presently, they have three in-house manufacturing/finishing units and four warehouses located in Delhi. They also have three third party dedicated units manufacturing exclusively for them. “We are setting up a garment washing unit at Sonepat. To meet our growth plans and to reduce our dependence on third party fabricators, we are proposing to set up a large integrated manufacturing facility at Bahadurgarh. The plant capacity is approximate 43.20 lakh of apparels per annum. On completion of the plant the total capacity will be approximate 54 lakhs of apparels per annum,” explains Bansal.

The economic slowdown resulted in a long draught of IPOs in the market. But now that the economy is on an upswing, IPOs from a number of companies are about to be launched. Bansal adds, “We think that the market has recovered and it appears to be in good shape. We feel an efficiently managed company which comes to market with a reasonable valuation will certainly receive a good response from the investors.”

The domestic organized garment retailing clocked a growth of 13-14 per cent for year ended March 2009. “Our thrust would be to be known as a leading player in the industry without bothering too much for the numbers. We would like to serve our customers better and to make a niche market for our brands and products. We would like to expand the retail base for the company by adding 180 stores by March 2011 along with an integrated manufacturing facility at Bahadurgarh. These two moves will help the company move ahead of its peers,” concludes Bansal.