ALSO READOn eve of GST roll-out, retailers brace for diehards Hot couture: It's all about practical fashion this summer Dollar Industries locked in upper circuit on NSE listing AB Fashion in talks with RIL and Maker group to open Saks stores AND, W, Biba step up game as global brands go all out to woo customers
After rolling out a wide denim portfolio as well as shirt and t-shirt lines, Pepe Jeans India, owned by UK based Pepe Jeans Europe B.V. will be entering the innerwear segment and is forming a joint venture with Dollar Industries Ltd for the product line.
The new entity, Pepe Jeans Inner Fashions Pvt Ltd, which will have an initial capital base of Rs. 72 crore, will have an equal share holding from both these firms which will imply a Rs 36 crore foreign direct investment in the innerwear space. In the next 4-5 years, a total of Rs. 200 crore investment will be made in this entity.
"Globally, we have our innerwear category but it was absent in India. So we were scouting for a partner who can manufacture as well as help in distribution of innerwear", Kavindra Mishra, managing director at Pepe Jeans India said.
Pepe Jeans, which forayed into India in 1989, has presence across 1,110 multi-brand outlets, 364 large-format stores and 216 brand outlets while Dollar Industries has presence across 1,00,000 multi-brand outlets.
"The sales channels for apparel and innerwear are very different and one needs to be careful in selecting the trade channels", V.K. Gupta, managing director at Dollar Industries said.
In the first year of operations, Pepe Jeans India, which clocked Rs. 424 crore topline in the last fiscal year, will eye Rs. 60 crore revenue from the innerwear range. This product category is likely to be launched by the end of the current fiscal year.
Mishra said in the next 9-10 years, his company is eyeing Rs. 600 crore from the innerwear line.
The branded innerwear market in India is pegged at Rs. 8,000 crore of which 25 per cent is under the premium category.