High Street Essentials (HSE), the parent company of FabAlley and Indya, on Thursday said it has raised Rs 8 crore in venture debt from Trifecta Capital.
Noida-based HSE was started in 2012 by two childhood friends Shivani Poddar and Tanvi Malik with fast fashion brand, FabAlley. In 2016, the duo launched Indya, an ethnic-fusion brand, in response to the growing demand for contemporary Indian wear.
In FY20, HSE scaled up its retail footprint with 10 new Indya stores and five FabAlley stores, along with expanding both brands to over 350 shop-in-shops across the country, a statement said.
"The company plans to deploy the fresh round of funding to further fuel the offline expansion of its brands," it added.
How two childhood friends bring inclusivity to fashion with their startup, High Street Essentials
This is the second round of debt infusion by Trifecta into the company, a statement said. HSE had raised its first venture debt round of Rs 5 crore from Trifecta Capital in January 2018, it added. The company had raised Rs 60 crore in Series B funding from SAIF Partners in December 2018.
As we scale both our offline and online presence, while incubating new offerings and brands in complementary spaces, it is imperative that we upgrade our infrastructure and working capital simultaneously," HSE Co-founder Tanvi Malik said.
She added that in the next 12-18 months, HSE plans to grow its retail presence by increasing its exclusive brand stores' count to 50 and doubling shop-in-shops to more than 650.
"The capital expenditure required to fund this growth is best done through debt, since it reduces the cost of capital and improves return on equity," HSE co-founder Shivani Poddar said.
HSE recently announced its FY19 results, and reported a net revenue of Rs 90.2 crore and profit of Rs 1.3 crore.
The company said it is on track to close FY20 at a growth of 75 percent over FY19, with EBITDA and PAT-level profitability.
(Disclaimer: Additional background information has been added to this PTI copy for context)
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