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Sunday, January 22, 2006

Kewal Kiran Clothing plans IPO, files DRHP with Sebi

Kewal Kiran Clothing, one of India's leading manufacturers and marketers of branded apparels in the men's segment, proposes to set up new manufacturing facilities and expansion of its distribution network by opening additional exclusive outlets. The total investment outlay is estimated at Rs 72 crore (Rs 720 million), according to a release.

To part finance this expansion plan, Kewal Kiran Clothing soon proposes to enter the capital market with an IPO of 31,00,000 equity shares of Rs 10 each through 100% book building process. It has filed DRHP with Sebi for the purpose.

ENAM Financial Consultants is the sole book running lead manager to the issue.

The issue would constitute 25.15% of full-diluted post issue paid up capital of the company and the shares are proposed to be listed on BSE and NSE

Kewal Kiran Clothing is an integrated apparel manufacturer and in the business of designing, manufacturing, branding and selling of ready-made apparels and other accessories under various brands. Their brands range from the high fashion premium segment such as 'Killer' for denim wear and 'Easies' for casual wear to the middle and economy segments through brands such as 'Lawman' and 'Integriti'.

In order to have more brand visibility and better reach to the customers with a pan India presence and also to expand its reach and serve additional customers in existing and new geographies, the company intends to set up additional 116 exclusive retail outlets, in addition to the existing 27 retail outlets across the country called "K-Lounge".

The company has four manufacturing facilities at Dadar (Mumbai), Goregoan (Mumbai), Vapi (Gujarat) and at Daman (Union Territory) with a total annual capacity of 2 million pieces. The distribution channel comprises of a mix of their own stores (K-Lounge) and a network of National Chain Stores, NCS, and Multi Brand Outlets, MBO.

As on December 31, 2005, the company has 27 K-Lounge stores and also present at 48 locations of National Chain Stores. The company is looking to further their presence in the growing Indian markets by rolling out their exclusive stores and through the presence in various department stores chains.

The consolidated restated revenues for the year ended March 31, 2005 was Rs 268.42 million as compared to Rs 253.90 million for the year ended March 31, 2004. Consolidated restated profit after tax was Rs 38.27 million for the year ended March 31, 2005 as compared to Rs 38.79 million for the ended March 31, 2004.

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