Indian retailer Fabindia scraps $482 mln IPO amid uncertain market conditions (updated)

ARVIND FASHIONS

27/02/2023 09:42

(Repeats to additional subscribers; no changes to text)
    By Aleef Jahan C S
       BENGALURU, Feb 27 (Reuters) - Indian apparel retailer
Fabindia said on Monday it has withdrawn its plan for a $482
million initial public offering amid rough market conditions,
becoming the latest company to scrap listing plans as interest
rate worries pressure stock markets.
    The 62-year-old company, popular for its sustainable and
traditional Indian wear, said it may consider going public in
the future and that several global ESG-focused funds had
expressed an interest to invest. It did not give details.
    Fabindia's move to pull its IPO plans comes after e-commerce
firm Snapdeal and wearable electronics company boAt pulled their
IPOs due to uncertain market conditions in the past few months,
while jewellery retailer Joyalukkas also scrapped such plans.
    "Sentiment is weak now. Most of these companies are looking
to raise money at higher valuations than is possible in the
market right now, and there is no proper appetite," said Hemang
Jani, equity strategist at Motilal Oswal Financial Services.
    India's benchmark Nifty 50 stock index  .NSEI  is down over
4% so far this year on worries that major central banks will
raise rates for longer to fight persistently high inflation.
    Shares of Fabindia's listed rivals Vedant Fashions
 VEDN.NS , Aditya Birla Fashion and Retail  ADIA.NS  and Arvind
Fashions  ARVF.NS  are down 14%-21% this year.
    Fabindia in January last year said it would raise 40 billion
rupees by selling new shares worth 5 billion rupees and up to
25.1 million in existing shareholders' stock in the IPO,
intending to use proceeds to repay debt and redeem
non-convertible debentures.
 
 ($1 = 82.9130 Indian rupees)

 (Reporting by Aleef Jahan and Chris Thomas in Bengaluru;
Editing by Janane Venkatraman and Sonia Cheema)
 ((aleefjahan.cs@thomsonreuters.com))