Tata Capital Pursues Rare Rabbit at $300 Million Valuation
Tata Capital, the financial services division of India's Tata conglomerate valued at $144 billion, is aiming to acquire around 13% ownership in the high-end domestic fashion label Rare Rabbit for an estimated $300 million. This move signifies Tata Capital's focus on tapping into the affluent consumer market in India. Sources familiar with the situation revealed this investment interest, highlighting a trend where competitors like Reliance, led by billionaire Mukesh Ambani, are also showing increasing interest in luxury fashion segments.
Tata has engaged in discussions with Rare Rabbit and is currently conducting thorough assessments after presenting a term sheet indicating an investment potential of up to $40 million to secure a portion of the specialized fashion brand, which specializes in men's shirts and other apparel. Founder Manish Poddar of Rare Rabbit and Tata Capital have refrained from providing comments, while the sources involved have chosen to remain anonymous due to the confidential nature of the negotiations. Rare Rabbit, initiated in 2015 by Radhamani Textiles, a family-owned Indian company, offers a range of products from shirts, jeans, jackets to sneakers, priced between $20 and $80, appealing to a broad spectrum of Indian consumers. The brand operates both online and through a network of 90 retail stores across India.
India's fashion industry has attracted significant interest from domestic and international players like Tommy Hilfiger and Japan's Uniqlo in recent years. Giants like Reliance and Tata Group have established their retail chains, targeting the burgeoning middle-class demographic with mid-range clothing selections available across the country. The ongoing discussions regarding the stake sale mark Rare Rabbit's inaugural external fundraising initiative. A local Indian private equity firm, A91 Partners, is also exploring the possibility of acquiring a stake in the company, competing with Tata for a potential deal, as mentioned by the three undisclosed sources.