Tata Capital, a financial services arm of India’s renowned Tata conglomerate, is contemplating acquiring an approximate 13 per cent stake in the domestic menswear fashion label, Rare Rabbit, valuing the brand at US $ 300 million. The move aims to tap into India’s affluent consumer base, according to three individuals familiar with the situation. This strategic investment aligns with Tata Capital’s interest in the upscale fashion segment, paralleling endeavours made by competitors like Reliance, led by billionaire Mukesh Ambani, in the premium fashion space.
Sources revealed that Tata has engaged in discussions with Rare Rabbit and is actively conducting thorough due diligence subsequent to presenting a term sheet proposing an investment of up to US $ 40 million to secure a significant portion of the specialised fashion brand. Neither Rare Rabbit founder Manish Poddar nor Tata Capital has offered comments on the matter, with sources opting for anonymity due to the confidential nature of the discussions.
Established in 2015 under the umbrella of Indian family-operated enterprise Radhamani Textiles, Rare Rabbit markets a range of men’s shirts, jeans, jackets, and sneakers, spanning prices from as low as US $ 20 to a higher-end range, typically reaching US $ 80 for most Indian consumers. With a presence both online and through 90 retail outlets across India, the brand caters to a diverse market segment.
Major retailers like Reliance and Tata Group have their retail chains geared toward India’s burgeoning middle-class demographic, focusing on mid-range clothing through their nationwide outlets. This potential stake acquisition marks Rare Rabbit’s maiden external fundraising initiative. Additionally, local Indian private equity firm A91 Partners is reportedly vying for a stake in the company, contending with Tata for a prospective deal, although A91 declined to offer any comments.
