V2 Retail raises $12 mn from PE firm Lighthouse

Delhi-based apparel retailer V2 Retail Ltd has raised Rs 76 crore ($11.7 million) from Lighthouse Advisors India, a middle market private equity firm focused on growth investments in India’s consumer sector.Public-listed V2 Retail, earlier known as Vishal Retail Ltd, will use the proceeds to accelerate its store expansion plans. Currently, the company has 44 stores across 13 states in the country and it aims to touch a store count of 100 in the next 2-3 years.

“We plan to further penetrate in our core markets, such as Bihar and Uttar Pradesh, due to the high potential in tier II and III cities, which remain significantly under-penetrated in terms of organized retail,” said Ram Chandra Agarwal, chairman and MD, V2 Retail.V2 Retail focuses on Tier II & Tier III cities and started operations in 2001. It sells fast-moving consumer goods besides apparel. The apparel retailer clocked net sales of Rs 471 crore during 2016-17 as compared to Rs 319 crore during the previous fiscal year.

V2 Retail’s scrip last traded at Rs 478 each, up 6.57 per cent on BSE in a strong Mumbai market on Monday.“We have been witnessing a structural change in the Indian retail landscape over the past few years, and are very excited to partner with V2 Retail,” said Sachin Bhartiya, partner, Lighthouse Advisors.

Lighthouse focuses on growth investments in the consumer sector. The firm’s portfolio companies include Bikaji Foods, Capital Trust, Cera Sanitaryware, Dhanuka Agritech, FabIndia Overseas, Kama Ayurveda, Suraksha Diagnostic, Unibic Foods and XSEED Education. It has also exited some companies like Dhanuka Agritech Ltd, Unibic Foods and Suraksha Diagnostics.The PE firm is planning to launch its third $235 million fund by end of this year. Founded by Mukund Krishnaswami and Sean Sovak, Lighthouse launched its first India-focused investment vehicle — India 2020 Limited (Fund I) — with a corpus of approximately $100 million in 2008. This was followed by the $135-million India 2020 Fund II, Limited in 2014.

In May, Lighthouse invested Rs 51 crore in Stylam Industries Ltd, a listed laminate manufacturer. Earlier this year, the PE fund sold its stake in biscuit maker Unibic Biscuits India to Peepul Capital, a mid-market PE investor.

(As published in Deal Street Asia on Tue, Octber 17 2017. )