TCNS Clothing IPO
(i)TCNS Clothing Co. Private Limited is India’s leading women’s branded apparel company in terms of a total number of exclusive brand outlets as of November 2017, according to Technopak.
(ii) They Design, Manufacture, Market and Retail a wide portfolio of women’s branded apparel across multiple brands. They sell products through 418 exclusive brand outlets, 1,305 large format store outlets and 1,361 multi-brand outlets, located in 29 states and two union territories in India. In addition to that they also have six exclusive brand outlets in Nepal, Mauritius and Sri Lanka. The company also sell the products through their own website and online retailers.
(iii)The product portfolio includes Top-wear, Bottom-wear, Drapes, Combination-sets and Accessories that cater to a wide variety of the wardrobe requirements of the Indian woman, including every-day wear, casual wear, work wear and occasion wear. The TOP brand in the portfolio is mentioned below:
a). Brand “W”: “W” is a premium fusion wear brand, which merges Indian and western sensibilities with an emphasis on distinctive design and styling. This brand is targeted primarily at the modern Indian woman’s work and casual wear requirements. “W” has been recognized as the ‘IMAGES Most Admired Fashion Brand of the Year: by India Fashion Forum consecutively for past three years between 2015 to 2017. “W” had 258 exclusive brand outlets and 676 large format store outlets located across 148 cities in India and five outlets outside India.
b). Brand “Aurelia”: Aurelia is a contemporary ethnic wear brand targeted at women looking for great design, fit and quality for their casual and work wear requirements. “Aurelia” had 159 exclusive brand outlets and 629 large format store outlets located across 149 cities in India and one outlet outside India.
c) Brand “Wishful”. Wishful is a premium occasion wear brand, with elegant designs catering to women’s apparel requirements for evening wear and occasions such as weddings, events and festivals. The Company is leveraging their “W” store network for selling Wishful products, however, they recently launched first exclusive brand outlet for Wishful, in September 2017.
iv) Revenue from sales of products under brand “W”, “Aurelia” & “Wishfulgrew” is growing at a CAGR of 48.67%,70.82% & 66.66% respectively during FY13 to FY17 . Moreover, in FY17 the revenue from “W”, “Aurelia” & “Wishfulgrew” accounted for 61.23%,30.35% & 8.41% respectively.
Objects of the TCNS Clothing IPO:
TCNS Clothing IPO
are: It is a pure OFS by the sale of up to 15,714,038 Equity Shares by the Selling Shareholders. The Company will not receive any proceeds from the Offer and all the proceeds will go to the Selling Shareholders.TCNS Clothing IPO Details:
| Current GMP: | 48-50 |
| Open Date: | Jul 18 2018 |
| Close Date: | Jul 20 2018 |
| Total Shares: | 15,714,038 |
| Face Value: | ₹ 2 Per Equity Share |
| Issue Type: | Book Built Issue IPO |
| Issue Size: | 1125 Cr. |
| Lot Size: | 20 Shares |
| Issue Price: | ₹ 714-716 Per Equity Share |
| Listing At: | NSE,BSE |
| Listing Date: | Jul 30 2018 |
Promoters And Management:
Capital Structure:
| (i) Authorized Share Capital 180,000,000 Equity Shares & 20,000,000 Preference Shares | 38 Cr |
| (ii) Issued, Subscribed,& Paid-up Share Capital Before Issue 61,318,124 Equity Shares | 12.26 Cr |
| (iii) Present Issue OFS to public 15,714,038 Equity Shares | 25% of Paid up capital |
| (iv) Reservation for QIB (7857019 Equity Shares at FV@2) | 50% |
| (v) Reservation for HNI (2357105 Equity hares at FV@2) | 15% |
| (vi) Reservation for Retail (5499912 Equity Shares at FV@2) | 35% |
| (vii) Paid Up Share Capital after the issue | 12.26 Cr |
Financials of TCNS Clothing IPO:
| 1. Assets and Liabilities Key Parameters | |||||||
| Year | Asset(Cr) | Liabilities(Cr) | Net Worth(Cr) | Book Value | D/E [<1.5] | RONW | debtor days |
| FY14 | 160.9 | 77.66 | 83.24 | 16 | 0.93 | 10% | 131 |
| FY15 | 214.39 | 104.09 | 110.3 | 21 | 0.94 | 24% | 79 |
| FY16 | 308.7 | 260.4 | 48.3 | 11 | 5.39 | -86% | 48 |
| FY17 | 425.8 | 143.9 | 281.9 | 51 | 0.51 | 6% | 51 |
| FY18 | 576.3 | 144.9 | 431.4 | 77 | 0.34 | 23% | 60 |
| 2. Profit n Loss Key Parameters | ||||||
| Year | Revenue(Cr) | PAT(Cr) | EBITDA Margins | Profit Margins | Outstanding Shares( Cr) | EPS |
| FY14 | 170.00 | 8.70 | 13% | 5% | 5.188 | 1.7 |
| FY15 | 301.00 | 26.20 | 17% | 9% | 5.188 | 5.1 |
| FY16 | 488.10 | -41.60 | -3.8% | -9% | 4.562 | -9.1 |
| FY17 | 712.90 | 15.60 | 11% | 2% | 5.57 | 2.8 |
| FY18 | 849.10 | 97.70 | 19% | 12% | 5.637 | 17.3 |
| 3. Cash Flow Statement(all figures in Cr) | |||||
| Particulars | FY18 | FY17 | FY16 | FY15 | FY14 |
| (i) Net Cash Generated from Operation | 41.33 | 25.10 | 34.429 | 14.07 | 8.03 |
| (ii) Net Cash Generated from Investment | -27.61 | -27.06 | -27.92 | -14.491 | -8.443 |
| (iii) Net Cash Generated from Financing Activity | 21.01 | 1.17 | -4.55 | 0.71 | -1.46 |
| (iv) Total[ (i)+(ii)+(iii) ] | 34.73 | -0.79 | 1.97 | 0.29 | -1.87 |
| (v) Cash at the Start of the year | 1.975 | 2.761 | 0.795 | 0.556 | 2.427 |
| (vi) Cash at the end of the year | 36.71 | 1.98 | 2.76 | 0.85 | 0.56 |
Comparison With Peers:
| Name of the Company | FV | Mcap(cr) | PAT(cr) | Sales(cr) | Mcap/Sales | RONW | P/E | P/B | NPM |
| TCNS Clothing Co. Limited | 2 | 4660 | 97 | 849 | 5.49 | 22.74% | 41 | 9.24 | 11% |
| Page Industries | 10 | 31743 | 343 | 2573 | 12.34 | 40.95% | 91 | 37.0 | 13% |
| Aditya Birla Fashion and Retail | 10 | 10855 | 122 | 7214 | 1.50 | 10.78% | 92 | 9.95 | 2% |
| Future Lifestyle Fashions | 2 | 7785 | 128 | 4532 | 1.72 | 8.24% | 60 | 4.98 | 3% |
| Kewal Kiran Clothing Limited | 10 | 1700 | 74 | 483 | 3.52 | 18.33% | 26 | 4.3 | 15% |
Recommendation on TCNS Clothing IPO:
Lead Manager of TCNS Clothing IPO:
Registrar of TCNS Clothing IPO:
Company Address:
Bid Details of TCNS Clothing IPO as on
20-Jul-2018 20:30:00 IST
Discussion on TCNS Clothing IPO:
28 Comments
Leave a Reply
You must be logged in to post a comment.
Looking at the P/E comparison with the peers, there’s a clear upside. Buy at current price which is what QIBs and smart investors are doing.
Yes, Monte Carlo which is in the Apparel Segment too has given strong results yesterday. Net Sales of Rs. 84 Cr in June Quarter as compared to 69 Cr in the same quarter last year. The Net profit of Rs. 6.24 Cr in June Quarter as compared to 5.21 Cr in the same quarter last year. TCNS is a good brand let us see how it goes from here on.
It seems that buying is happening in TCNS as trading is happening on sellers price but still lot of shares are still with retail investors, out of total 76 lacs shares allotted to Retail and HNI, only 37 lacs marked for delivery yesterday
Many big grey brokers and punters have got stuck in TCNS … still holding … still bleeding
Crowd looking for listing gains getting out, investors believing in stock fundamentals are getting in
Looks like Retail and NIIs are selling and QIBs buying, this is in line with the subscription, not a bad trend, price will improve by EOD.
Yes, I am also expecting the same.
Flat listing of TCNC clothing. Let us see how the story unfolds at the E.O.D.
Targets dene wala nahi ..
Usko eyes close karke maanne vaala is responsible ..
Wake up call .. #TCNSlistingtoday#
HDFC IPO
GMP 620 +/- 2
Kostak 1800
TCNS IPO
GMP 43 +/- 1
Neutral on this issue.
It is almost debt free company and we have seen in past that most of debt free company have given great returns post IPO
Lets wait for listing and hope it reward people who applied this issue
Money starts debiting for TCNS Clothing. Everybody, please check.
Listing can be surprising.
HDFC IPO
GMP 497 +/- 2
Kostak 1750
TCNS IPO
GMP 30 +/- 1
Should be a very volatile listing.
Listing is Sheela foam now game.
Yo. It could be dark horse. Let us wait for listing
Good response from QIB and NII at the end. We are expecting 3-5% listing gain in TCNS Clothing. Let us see on listing day. We will meet on listing day i.e July 30 to make new strategy. Please stay tuned with http://www.investorzone.in for more such updates in IPOs.
The Next big thing coming in primary market is HDFC AMC IPO which is opening on 25th July 2018. For complete analysis please visit at https://investorzone.in/ipo/hdfc-amc-limited-ipo-hdfc-mutual-fund-ipo/.
After spill over, the QIB quota- 7.58, HNI quota- 3.87 and Retail quota- 1.
Spill over means, as Retail quota was not fully subscribed, the left over shares were distributed among QIBs and HNIs.
Anchor list-
Goldman Sachs India Ltd, Auburn Ltd, Fidelity Securities Fund Fidelity Blue Chip Growth Fund, DB International Asia Ltd, ICICI Prudential Life Insurance Company Ltd and UBS Principal Capital Asia Ltd.
TCNS Clothing has allotted 47,14,210 equity shares to 18 anchor investors at Rs 716 per scrip, garnering Rs 337.54 crore.
Apart from Pricing of the IPO and fierce competition from the unorganized sector, other parameters are looking quite strong for the company. Let us see the position of the Balance Sheet, the company has long term debt = 20 lacs and Short term debt =40K which is negligible in front of 43 cr equity. The company has excellent RONW of 22.74%. The company has manageable receivables under 60 days. The company is also generating positive cash flows from the operations.
If anyone wants to play the story of brand in clothing, then TCNS is right kind of stock to look upon. The Branded segment in India is having market share of only 23%. So opportunity is huge in the market and company has shown 30% CAGR growth smartly outgrow the industry which is growing at a CAGR of 10%. However, the competition from unorganized sector is huge in this sector and going forward this would be a challenge for the company.
These type of stocks only generate interest during ipo time .I don’t find this as a portfolio stock. If anyone wants to take risk for listing gains then apply after looking at subscription figures .If the subscription is good one can apply for short term only .
I agree Tarun. This is not a portfolio stock for sure. This is not even a listing gain stock. Considering the niche, market sentiments etc it should list negative..😁
**************************RISK in the Company**********************
1. The company do not own any manufacturing unit and engage job workers for manufacturing all their products.The company has 37 designers on board and retaining them would be challenge for the company. The growth will dent in future if they decided to part away with company.
2. The Company has 289 exclusive brand outlets and four warehouses located in New Delhi on a leasehold basis. All these outlet are on Lal dora area of New Delhi, the use of such land for commercial purposes has been, in recent years, subject to increasing regulation by local municipal authorities. So any changes in law will impact company’s growth in future.
3. The Company is highly dependent on franchisee and online retailers for majority of their sales. Now a days we are seeing price war in online retail website due to huge competition, so if company is not able to pitch right price of their product they may loose significant online retail business.
4. It is a seasonal business. Sales generally improved in and around Diwali.
5. The industry is highly competitive. The unorganized players in the market are biggest threat to this company.
The company has total profit of 97 Cr in FY18 on the basis of which the EPS would be around 15.92. The IPO is priced at 716, so on the basis of this price the offered P/E= 44.97. Looks pricey issue.