Mumbai
: Bahrain-Based Private Equity Firm Investcorp Earned More than Four Times Its Investment after Exiting Value Retail Chain Cightykart, which Raised About 538 Crore in Its Series B Funding Round, LED by TPG NEWST and A91 Partners, Through a Mix of Direct Investment and Share Sales, A Top Executive Said.
Investcorp Invested 75 Crore in 2019 in the company’s Seed Round and Will Now Exit With About 280-300 Crore, Citykart’s Co-Founder Sudhanshu Agarwal Told Mint in an interview. “We Undertook This Inshere Process to give an exit to our investors. Raise a Debt Round Later, there are no immMIDIELE PLANS to Raise Any Further Capital. “
TPG Newquest – A Secondary Private Equity Platform For Asia within TPG, and Growth -STAGE Investor A91 Partners’ Entry Marks A Significant Shift In the Company’s Cap Table, WHIL Existing Investor India sme fund continues to hold a minority stake.
The company did not disclose any details of the Valuation.
As per the term of the deal, about 120 Crore Constitus Primary Capital that will be used to accelerate the company’s excavations plans, such as increasing store count and entering new product categories. The company has about 137 stores but plans to add another 40-50 every year.
The remaining portion was reserved for secondary transactions. Typically, Sharehlders in a Secondary Transaction Sell their stakes to other existing or new investors, and no new capital is injected into the company. Secondary transactions generally take place at a discount to the primary shares.
Increasing Stores
“We will be brings in more stores in the areas where we are present and will also explore other neighbouring states. We will focus on a combination of Fortification (Strengthening Presence in Existing Areas) as well as forwarding into newer territories, “Agarwal said.
Beyond Apparel, Citykart is also evaluating newer products like cosmetics. “We are noticing that cosmetics has become very big in tier 2 and 3 areas. Stores, “He said. “So, we feel cosmetics is one field among 4-5 other categories where we can really drive volumes and become more relevant for our customers.”
In FY24, Citykart Reported an operating income of 628 Crore, Compared to 524 Crore a year ago. It posted a profit of 11.94 Crore, Compared to 24 lakh in fy23, according to a crisil ratings report in August.
Agarwal further said the company reported revenue of 950 Crore in FY25 and Expects to Reach about 1,300 Crore in the current financial year. Citykart will also tap the public markets to further unlock value for its sharehlders, but it aims to at least double its its scale before Considers a listing, He Said.
He attributeed the increase in revelation and improved profitability to better the same-store sales growth (SSSG) over the last two years. “We Did Some Surveys of Customers Visiting Our Stores as Well as Other Nearby Markets and Retailers, and We Realized that they are very value-conscious. Won’t work as they are looking for more offers and promotions, “Agarwal said.
Customer feedback
“We Made some changes based on these observations, and we saw near 70% of our customers come back. Contributed to a bulk of our sssg, “He said. They will continue pricing their products attractively and drive volumes that will target a broader base of customers.
Founded by agarwal and his brother Rohit Agarwal in 2015, Citykart Aims to Further Strengthen Its Reach in Underserved Yet Budget-Conscious Markets. With the Bulk of its Revenues Coming from Tier 2 & 3 Areas AlongSide a portfolio of in-house brands such as athiya, nimes, fumee, and remise, remise, remise, the company cats to over 15 millions of.
Crisil noted that the company’s established market presence in Tier 2 Areas and Beyond offers healthy potential for growth. However, it Continues to face some headwinds from the fragmented nature of the industry, which results in intenses in intenses from the unorganized market. The company’s growth is limited by the number of new stores it can open.