The Loot to dilute 25% stake

Mumbai-based The Loot (India) Pvt Ltd, plans to dilute around 25 per cent stake to private equity players to raise Rs 100 crore for expansion.

Jay Gupta, Managing Director of The Loot said, "We plan to dilute not more than 25 per cent to private equity firms or venture capitalist.. Through the dilution the company would be raising Rs 100 crore to fund its expansion.

By 2008-09, it expect to achieve the set target of 100 stores across the country under its current expansion plan. The company had received offers from some of the private equity player to pick up stake, but would like to dilute its stake once it has strengthen its position it the retail market.

The equity dilution will be done before the end of the year 2008 as the company also plans to come out with initial public offering. "We plans to come out with IPO before march 2009 to raise not less than Rs 100 crore", adds Gupta. Uptill now it has funded its expansion plans through a mixture of debt and internal accural.

The fund raised from the IPO will be also be pumped into expansion for its stores. The company has five business format - medium, large, excel, extra large and small & small extra business format. The company has yet to launch the fifth format - small & small extra business format that is category store.

The category store will target single category of customers like ladies wear or men's wear or shoes etc. According to Gupta, each format has potential of having 500 stores atleast in the country.

As per the company, it is growing at the rate of 65 percent uptill last year and it expect to grow further at a rate of 100 percent. Substantiate its claim, Gupta informs that the company already has 50,000 sq. foot of operational areas of its stores and by the end of these year it will add 1,00,000 sq. foot of operational areas of stores.

The company has topline of Rs 25 crore for the financial year 2005-06. Whereas the expected topline for the financial year 2006-07 might be Rs 50 crore.