28 December 2010, MINT (A partner to the Wall Street Journal)
The Bindra family, the owners of Biba Apparels Pvt. Ltd, which
owns a popular womens ethnic wear brand of the same name,
is on the verge of splitting, said a person directly involved
in the development, who did not want to be identified till the
details are made public.
Sanjay Bindra, 45, will sell his stake for around Rs 75 crore
in an all-cash deal, added this person.
Siddharth Bindra, 36, confirmed that Sanjay Bindra was exiting
the business and added that he would be buying his brother out.
He declined to speak about the specifics till the transaction
The Kishore Biyani-promoted Future Ventures India Ltd owns an
18% stake in Biba that it acquired in 2006 for an undisclosed
amount. The Bindras own the rest of the privately-held firm. The
individual stakes of Sanjay and Siddharth arent known; privately-held
firms do not have to disclose their shareholding pattern.
Biba, founded 22 years ago by the brothers mother Meena
Bindra, ended the year to March with revenue of Rs 180 crore and,
according to the person cited in the first instance, will end
the year to March with revenue of around Rs 200 crore.
Meena Bindra started the business in 1988 with a bank loan of
Rs 8,000, selling ethnic wear from home. Sanjay joined the family
business in 1994 and Siddharath, in 2002; soon after the firm
started film merchandising, creating special clothing lines for
Bibas clothing is available in 100 retail outlets across
25 cities, according to its website.
Sanjay Bindra is still on the board of Biba Apparels but he has
already started work on his new company, which is likely to sell
ethnic-wear apparel under the brand 7 East, the person
cited in the first instance said.
The company will be launched by mid-March with 18 stores
and 60 shop-in-shop stores. The 7 East brand will look at tie-ups
with designers such as Manish Malhotra, known to style Bollywood
celebrities, and other international designers, he added.
In 2009, the market for domestic apparel was worth Rs 1.54 trillion
and is expected to reach Rs 4.7 trillion by 2020, according to
India Textile and Apparel Compendium 2010 published by Technopak
Advisors, a retail consulting firm.
It is a highly fragmented market with few significant brands
such as Biba, Ritu Kumar and private labels from retailers such
as Trent Ltds Westside and Future Groups Pantaloons.
The organized apparel market is expected to grow from 14% at
the end of 2009 to 40% by end of 2020, said the report.
Unlike the Western market, customer preferences for Indian
ethnic wear vary across the length and breadth of the country,
making it difficult for brands to establish themselves nationally,
said Devangshu Dutta, founder of retail consulting firm Third
Eyesight, explaining why very few brands have succeeded.