Lovable Lingerie launches IPO to scale up operations

Mumbai-based Lovable Lingerie, a leading international women’s innerwear brand, has entered the Indian capital market with an initial public offer (IPO). The company has launched an IPO of 45,50,000 equity shares at a face value of Rs 10 each for

cash at a price band fixed of Rs 195 and Rs 205 per equity share. The closing date is March 10, 2011, for qualified institutional buyers, and March 11, 2011, for non-institutional bidders and individual bidders. The issue would constitute 27.08 per cent of the post issue paid-up capital in the company’s new IPO route. “The issue is being made through a 100 per cent book-building process where not more than 50 per cent shall be allocated on a proportionate basis to QIB bidders. We plan to set up a manufacturing facility at Bangalore, open EBOs and shop-in-shops and upgrade our design studios,” says a company spokesperson.

Incorporated in 1987, Lovable lingerie’s product portfolio includes brassieres, panties, slips/camisoles, home-wear, shape-wear, foundation garments and sleepwear products. In December 2000, the company acquired the brand ‘Lovable’ from US-based Lovable World Trading Company on an exclusive basis for the territories of India, Nepal, Sikkim and Bhutan. Their flagship brands are Lovable - a premium brand and Daisy Dee in the mid-segment.

Meanwhile, Lovable Lingerie has already raised Rs 2,000 lakh through a pre-IPO placement of 10, 00,000 equity shares with SCI Growth Investments II at a price of Rs 200 per share. This also includes a premium of Rs 190 per share. The pre-IPO placement comprises 5.95 per cent of the fully diluted equity stake in the company post its initial IPO. SCI together with the promoters holds the entire pre issue capital of the company.

The company has plans to use the money generated from its IPO along with the proposed issue proceeds, towards setting up a manufacturing facility that will allow additional capacity in Bangalore as well as brand development for their latest mid-segment ‘College Style’ brand.

The group has 127 counters in stores like Westside, Shoppers Stop and Lifestyle among others in 21 cities. It also retails through 7,500 MBOs in 105 cities. At the moment they have three manufacturing facilities, of which two are in Bangalore with an installed annual capacity of 60 lakh pieces and another in Uttarakhand with an installed annual capacity of 7.5 lakh pieces. Lovable Lingerie recorded a turnover of over Rs 86.95 crores and a net profit after tax of Rs 10.55 crores in FY 2010. In order to keep up with consumer tastes and fashion cycles, the company has set up an in-house design studio for developing innerwear products and creating styles that keeps up with changing global trends of women’s inner secrets.