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Business News/ Companies / Everstone-backed FACES Cosmetics seeks Rs100 crore
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Everstone-backed FACES Cosmetics seeks Rs100 crore

FACES has plans to increase its store-in-store outlets from 700 to around 1,200 in India by the end of fiscal 2022

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Canada-based branded cosmetics and skincare products firm FACES Cosmetics Ltd, backed by the India-focused investor Everstone Capital Partners Llc, is looking to raise as much as Rs60-100 crore, two persons aware of the plan said.

“Everstone group is raising capital for FACES Cosmetics as India becomes its key market," said a person with direct knowledge of the development, requesting anonymity.

FACES, which came to India in 2009, is already among the top 10 cosmetics brands in India. FACES has plans to increase its store-in-store outlets from 700 to around 1,200 in India by the end of financial year 2022. Over the next one year, the colour cosmetic firm expects to expand to 100 cities from about 80 at present.

“ The capital it is planning to raise would be utilised to accelerate its presence, especially in India, which is its biggest market. They have appointed Deloitte as the banker to advise it on the fund raising," the second person said, also on condition of anonymity.

FACES’s consumer sales are expected to grow at a compound annual growth rate of 50% to cross Rs220 crore by 2019.

“Over the last two years, Everstone has worked with the business to sharpen the brand, step up the quality and pace of innovation, and significantly strengthen operations. All this has contributed to accelerating the business, more than doubling consumer sales in a couple of years to achieve the important milestone of Rs100 crore this year," said Rajev Shukla, managing director of private equity at Everstone Capital, but declined to comment specifically on the planned fundraising. An email sent to Deloitte did not elicit any response as of press time.

Indivision India Partners (Everstone Capital Partners I), a $425 million private equity fund, invested an undisclosed amount for a majority stake in FACES Cosmetics, which sells makeup, skincare products and personal care accessories, in 2007.

Everstone’s other investments in the personal grooming space are in VLCC Healthcare Ltd, which runs a chain of weight management and beauty treatment clinics, and Bangalore-based R&R Salons Pvt. Ltd, which runs the YLG salon chain. The PE firm had acquired a majority stake in R&R Salons in 2012. R&R Salons was backed by Helion Venture Partners Llc.

The highly fragmented beauty and wellness market in India has attracted limited interest from large PE funds, although the sector has seen several investments by venture capital investors in the last five years.

The size of India’s beauty, cosmetic and grooming market will touch $20 billion by 2025 from the current level of $6.5 billion, according to a recent study by industry lobby group Associated Chamber of Commerce and Industry of India (Assocham). The beauty and wellness sector in India has seen 20 PE deals worth $32 million since 2011, according to data from VCCEdge.

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Published: 28 Oct 2016, 01:04 AM IST
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