Women clothing brand Libas, which announced securing INR 150 crore funding, aims to double its sales in the next two years to INR 1,000 crore, said its Founder and CEO Siddhant Keshwani.

Zivore Apparel, the company which owns the brand Libas announced the closing of its first external funding round, with an investment of INR 150 crore by IAF Series 5, a fund managed by ICICI Venture. This is the first time that the fast fashion ethnic wear brand has raised external funding.

The infusion of this fresh capital is expected to help build an omnichannel presence for Libas by strengthening its current digital presence and accelerating offline expansion.

Over the apparel market, Keshwani said he is now witnessing a 'sign of recovery' and an upward trend in consumer spending in the fast fashion market. The fast fashion ethnic wear brand, which started its journey as a D2C brand in 2014, has adopted an omnichannel strategy and is targeting to have a network of 150 physical stores in the next 3-5 years.

Though Libas's immediate focus is on metros for expansion in the ‘brick-mortar’ format, it recognizes the potential for growth in tier II and III cities and is leveraging data-driven insights to strategically target these areas in the future.

Zivore Apparel is adopting the company-owned, company-operated (COCO) model for its stores, focusing initially on metro cities and select smaller towns with a strong online presence and customer base, he added.

Besides the domestic market, Libas is also planning for the international market, targeting the Indian diaspora, especially in markets such as the UK, USA, UAE, and Australia, where it is serving through its online platform.

When asked about the growth, Keshwani said, ''We are targeting internally that we should close FY26 at about INR 1,000 crore net revenue -- majorly being driven through our offline channels and, of course online as well.''

“The company has crossed a milestone of INR 500 crore revenue in the financial year ended March 2024. Currently, online sales account for approximately 80-85% of our business, with offline sales contributing around 10 to 15%. However, we aim to achieve a more balanced distribution, targeting 50-60% online and 30-40% offline sales in the next two to three years,'' Keshwani added.

Currently, around 50 to 55% of Libas business is contributed by the metro markets, and the rest comes from tier II, III and below towns.

Libas’ website accounts for 15% of its sales, while marketplaces like Myntra and Amazon contribute 70% to its topline. The remaining 15% comes from offline channels. The startup claims to have clocked a revenue of INR 500 Crore in the financial year 2023-24 (FY24).

When asked about the current market condition and demand for apparel, which had faced a slowdown in demand as customers have put their discretionary spending on hold tightening their purses, Keshwani said there are ''signs of recovery''.

''Despite recent economic challenges, we are starting to see signs of recovery and an upward trend in consumer spending, particularly as we approach the festive season. We remain cautiously optimistic about the future growth prospects of the industry,'' he said.

Gagandeep S Chhina, Senior Director, Private Equity, at ICICI Venture, said: “Libas under the leadership of Sidhant and Sunil Keshwani, through its focus on product quality, design and fast fashion, has become a well-established apparel brand for Indian women consumers. Libas has demonstrated industry-leading growth characteristics in a capital-efficient manner and plans to strengthen its digital presence while focussing on its offline expansion and omnichannel capabilities in the Indian market. The industry is expected to see organised players with a focus on branding and omnichannel customer experience become brands of choice for the consumers,”

The brand has a strong online presence on platforms such as Flipkart and Myntra, alongside offline presence through EBOs, large format stores and multi-brand outlets. A significant portion of the revenue comes from the brand's own D2C channels.

KPMG acted as the exclusive transaction advisor to Libas. JSA acted as the legal advisor to IAF Series 5, a fund managed by ICICI Venture.

Article Source – PTI, Libas (Press Release), Inc42

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