Aditya Birla Group’s TMRW acquires majority stake in 8 fashion brands

TMRW, the direct-to-consumer (D2C) focused entity of Aditya Birla Group, has acquired majority stakes in eight brands in the fashion category. The group is expected to invest a cumulative amount of Rs 289 crore for the acquisitions according to filings with BSE; some of the deals are yet to be closed.

TMRW will also buy 73-80% stake in casual fashion brand Bewakoof for Rs 200 crore, including a primary equity and debt infusion, as well as a secondary stake acquisition in the brand. Bewakoof is backed by the likes of InvestCorp, IvyCap Ventures, and Spring Marketing Capital, and raised Rs 60 crore led by InvestCorp last August. The deal is expected to close in the next 30-90 days and is the largest investment among the eight brands acquired by TMRW. 

Other acquisitions include women’s western wear brand Berrylush, women’s casual and western wear brand Juneberry, teen’s wear brand Natilene, kidswear brand Nauti Nati, athleisure brand Urbano, and fast fashion brand Veirdo. 

According to a statement by the company, the cumulative revenue run-rate of the company through the acquisitions stands at Rs 700 crore, targeted to double and cross Rs 1,500 crore in the next 12 months. 

“We take majority stakes in the companies and it is a founder-led partnership where the idea is to build something together for the next five to six years,” Prashanth Aluru, Chief Executive Officer (CEO) of TMRW told YourStory. He added that the entity was looking to buy 10-12 brands in the first year of operations. Aditya Birla Group had announced the launch of its D2C business in February.

What's next?

Prashanth said that TMRW will evaluate opportunities in the beauty and personal care segment by next year and expand its portfolio of brands to include home and decor.

“The lack of capital isn’t the only issue in scaling digital-first brands, They need a tech-led scaling path with fashion technology, marketing expertise, differentiation and the right channel mix. There is enough potential to grow through the digital path,” said Prashanth, adding that TMRW will not immediately push its portfolio brands to offline retail through Aditya Birla Group’s existing footprint.

TMRW will also tap into private market investors to support the cost of acquiring new brands going ahead by next year, he added. 

A subsidiary of Aditya Birla Fashion Retail Limited (ABFRL), TMRW has access to the group’s network of 3,468 stores and 28,585 multi-brand outlets. ABFRL houses brands including Louis Philippe, Van Heusen, Allen Solly, and Peter England, besides fashion retail store Pantaloons. 

(This story was updated to correct two typos.)