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MarketScreener Homepage  >  Equities  >  MUMBAI STOCK EXCHANGE  >  Aditya Birla Fashion and Retail Limited    535755   INE647O01011

ADITYA BIRLA FASHION AND RETAIL LIMITED

(535755)
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Flipkart to buy 8% stake in Aditya Birla's fashion unit for $204 million

10/23/2020 | 03:19am EST
The logo of India's e-commerce firm Flipkart is seen in this illustration picture

BENGALURU (Reuters) - Walmart Inc's Flipkart will buy a 7.8% stake in Aditya Birla Fashion and Retail Ltd for 15 billion rupees ($204 million), giving the ecommerce company a bigger foothold in the high-margin fashion business as it battles it out with rival Amazon.com in the country.

Shares in Aditya Birla Group's fashion unit rose as much as 6.5% on Friday following the news, hitting their highest since March 30.

The investment comes at a time when Amazon.com Inc, billionaire Mukesh Ambani-led Reliance Industries and Flipkart are in a race to gain market share in India's fast-growing online market for everything from food and groceries to electronics and clothes.

With the COVID-19 pandemic keeping most people indoors, more Indians are shopping online, especially ahead of the key festive season.

"Fashion retail in India is set for robust long-term growth due to strong fundamentals of a large and growing middle class," Aditya Birla Group Chairman Kumar Mangalam Birla said.

"Rapid growth of technology infrastructure will further accelerate this process," he said, adding that the country's apparel industry was set to be worth $100 billion in the next five years.

For Flipkart, which already owns the popular Myntra fashion website, the deal is a way to add more merchandise from international brands to its roster.

Aditya Birla owns rights to sell Forever 21, American Eagle Outfitters and Ralph Lauren branded clothes, among others, in the country.

The deal will also help Aditya Birla cut down debt, analysts said. As of March 31, 2020, the company's debt stood https://www.bseindia.com/xml-data/corpfiling/AttachHis/36845f03-79e2-43b9-8fa6-298c3fac055c.pdf at 27.76 billion rupees.

"They can scale up the business, and there will be a long-term benefit through this partnership," said Vaishnavi Mandhaniya, analyst at Anand Rathi Financial Services.

Media reports https://www.livemint.com/industry/retail/flipkart-amazon-hold-talks-to-acquire-stake-in-aditya-birla-fashion-11603348168136.html had said both Amazon and Flipkart were in the race to acquire a stake in Aditya Birla Fashion and Retail.

($1 = 73.6100 Indian rupees)

(Reporting by Chandini Monnappa and Nallur Sethuraman in Bengaluru; Editing by Subhranshu Sahu)

By Chandini Monnappa and Sethuraman N R


© Reuters 2020
Stocks mentioned in the article
ChangeLast1st jan.
ADITYA BIRLA FASHION AND RETAIL LIMITED 1.96% 164.25 End-of-day quote.-29.16%
AMAZON.COM, INC. -0.51% 3203.53 Delayed Quote.73.37%
AMERICAN EAGLE OUTFITTERS, INC. 2.51% 18.35 Delayed Quote.24.83%
BIRLA CORPORATION LIMITED 1.21% 743 End-of-day quote.21.76%
RALPH LAUREN CORPORATION 0.34% 88.92 Delayed Quote.-24.14%
RELIANCE INDUSTRIES LTD 0.54% 1968.4 Delayed Quote.30.56%
WALMART INC. -1.39% 150.52 Delayed Quote.26.66%
All news about ADITYA BIRLA FASHION AND RETAIL LIMITED
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08/12ADITYA BIRLA FASHION AND RETAIL LIMI : quaterly earnings release
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More news
Financials
Sales 2021 54 223 M 734 M 734 M
Net income 2021 -6 008 M -81,3 M -81,3 M
Net Debt 2021 10 682 M 145 M 145 M
P/E ratio 2021 -26,4x
Yield 2021 -
Capitalization 142 B 1 926 M 1 922 M
EV / Sales 2021 2,82x
EV / Sales 2022 1,79x
Nbr of Employees 23 269
Free-Float 39,9%
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Mean consensus -
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Last Close Price 164,25 
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Managers
NameTitle
Ashish Dikshit Managing Director & Executive Director
Jagdish Bajaj Chief Financial Officer & Chief Risk Officer
Praveen Shrikhande Chief Digital & Information Officer
Sushil Kumar Agarwal Non-Executive Director
Sukanya Anand Kripalu Independent Non-Executive Director
Sector and Competitors
1st jan.Capitalization (M$)
ADITYA BIRLA FASHION AND RETAIL LIMITED-29.16%1 926
INDUSTRIA DE DISEÑO TEXTIL, S.A.-11.22%104 494
KERING SA3.40%91 606
FAST RETAILING CO., LTD.34.14%85 665
ROSS STORES, INC.-4.19%39 709
HENNES & MAURITZ AB-2.48%36 191