Tag Archives: venture

LVMH Group to fund India’s Ready-to-Wear Fashion Retail

The world’s largest luxury goods conglomerate, LVMH Group, will launch its private equity fund in India, in an attempt to tap the burgeoning disposable income and rising aspirations of the country’s urban population, especially women.

L Capital, present in New York, Madrid, Milan, Shanghai and Singapore, will invest in India from its fourth fund, which is dedicated to Asia and has a corpus of $650 million. It also will focus on economies such as China, Malaysia, Indonesia and Thailand.

“We are looking at investing in companies in the lifestyle arena in Asia, primarily from the aspirational segment, meaning people who are moving from mass-produced goods to the next layer up,” said Ravi Thakran, managing partner of L Capital. “We are not keen on top-end luxury in India. We may look at that, but that is not our main focus.”

Mr. Thakran said Indian high-end designers are missing out on the real growth story in fashion by focusing on couture, which caters to the richest 500 families, and the wedding apparel business. The opportunity, he said, is in the ready-to-wear segment.

Mr. Thakran–who previously worked at the Swatch Group and helped launch Indian jewellery brand Tanishq in the U.K.–also, is betting on discretionary spending gaining pace in India.

“Today the world is moving towards a new center stage, which is certainly Asia, but China and India are two pillars of that,” he said. “This was the case pre-crisis but post-crisis it is even more so.”

However, India lags behind China when it comes to scalable brands and businesses. “In China, there are already at least 10 businesses we might be interested in which are worth $200 million to $250 million, whereas in India none of the (best known) designers have even reached the $100 million scale,” Mr. Thakran said.

L Capital is looking to bring in expertise on operational improvements in areas such as product design, logistics, store design, visual merchandising, talent search and training and development. Assistance in these areas for an early stage growth company is more important than capital, Thakran said.

He will be looking for deals in shoe, apparel and wine businesses, makers of lifestyle furniture, beauty brands, apart from skincare centers and spas.

“This is where the new consumption is rising in India,” Mr. Thakran said. “When aspirations and disposable incomes rise, consequently consumption in new arenas, our targeted sectors, also rises.”

Fashion designer J.J. Valaya, in an e-mail response, defended the prevalent focus on couture and wedding dresses, citing “lack of infrastructure, distribution and adequate capital.” He added that ready-to-wear is profitable only if it achieves volume.

“At present the top names in the country are not prepared to reach those numbers single-handedly,” Mr. Valaya said. “In the West too, a Louis Vuitton or a Jimmy Choo achieved reach through strategic corporate associations.” According to Mr. Thakran, Indian fashion businesses suffer because the creative force, the designer, is forced to look after operations due to lack of resources.

This shortage of resources has prevented recognized Indian businesses from transforming themselves into brands with greater economic value, he said. “If the creative guy is busy sorting out the accounts and logistics, and looking after the retail store, he cannot focus on the creative part,” Mr. Thakran said. “If you can bring to them knowhow in these areas and to build that front end, these brands can really unleash their potential.” (Source: Online WSJ.com)

QATAR FOUNDATION to develop local luxury brands

Qatar Luxury Group (QLG), the first venture of Qatar Foundation in the luxury segment, will unveil a series of all-new Qatari brands this year in the fashion, hospitality and lifestyle sectors. Gregory Couillard, Chief Executive Officer of Qatar Luxury Group, said that two years after the Group started it is creating a structured portfolio of culturally informed high-end brands that offer exclusive experiences and timeless products.

The press release posted in the CPP website does not mention whether the Qatar Luxury Group will embrace sustainability and responsibility- a big must now in the Middle East countries, as shown by the Masdarcity  and the many project requests ECOFFEE receive everyday. We will investigate about and keep you updated.

CPP-Luxury, an online business magazine, adds that the Group is currently active in two main sectors — fashion and hospitality. Fashion represents the core activity of the Group, which has invested heavily in world-class design and engineering equipment for in-house development of product lines. Prototyping units on jewellery, luxury ready-to-wear apparel, shoes, leather goods and accessories are all located at the QLG’s headquarters and soon a manufacturing facility will be opened for mass production of the unique product lines which is not only meant for the local market but for the international sphere as well.

The first initiative of the Group will be the launch of a restaurant later this year in collaboration with an internationally recognised 3-star Michelin French chef, two more restaurants in 2012 and one luxury fashion brand alongside the Group’s development of projects in the lifestyle sector. Couillard is optimistic QLG will contribute considerably in the country’s thrust toward diversifying its economy. The Group has a strong team with members from 14 nationalities including designers from Belgium, Chile, Qatar and US.

The press release posted in the CPP website does not mention whether this huge project will embrace sustainability and responsibility- a big must now in the Middle East countries.