Sanjeev Mohanty, CEO of the online fashion retailer Jabong said that the Global Fashion Group (GFG) firm is tracking a good pace of growth and it expects 20-30 percent growth in sales this year and cleared that he is still with the company. Jabong narrowed down its gross loss to Rs 46.7 crore for 2015 on the back of lower level of discounts from Rs 159.5 crore in 2014.
Its net revenue rose 7.1 percent to Rs 869.1 crore in 2015 compared with Rs 811.4 crore in 2014. The GMV in 2015 increased to Rs 1,502.9 crore compared with Rs 1,320.6 crore in 2014. Mohanty was brought in by Jabong to steer the firm facing strong competition. On a possible sale of equity, Mohanty said the company is exploring multiple options, including getting new investors on board or a complete sell out.
He said that they have always said that they are looking at all options and it is not possible to give a timeline as these things take time. It could be 4 weeks or 6 or 8 weeks. According to sources, Jabong
is in discussions with players like ecommerce major Snapdeal, Aditya Birla Group and Kishore Biyani's Future Group for a possible sell out. The deal which has been in the works for some time is floundering as many suitors have backed out.
Another source close to the discussions said a distress sale is more likely now with the withering away of the team and potential investors. While Jabong investors are seeking a valuation of about USD 100-150 million, the deal, if it goes through, may close at a much lower valuation of around USD 50 million.
When contacted, Snapdeal and Aditya Birla Online Fashion (Abof.com) declined to comment, while Future Group did not respond to emailed queries. Jabong was founded in 2012. In September 2014, its investor, Rocket Internet merged Jabong with four other online fashion retailers in Latin America, Russia, the Middle East, South-east Asia and Australia to create Global Fashion Group (GFG). Swedish investment firm Kinnevik also owns a large stake in Jabong's parent Global Fashion Group.
While Jabong has managed to reduce losses by reducing discounts, both AB Kinnevik and Rocket Internet seem unwilling to infuse fresh capital and are believed to be keen to exit. In April this year, GFG raised fresh funding from existing investors at a lower valuation, raising 300 million euros from Rocket Internet and Kinnevik. Post the last round, GFG was valued at 1 billion euros, a significant fall from earlier valuation of 3.1 billion euros.
News Source From : http://www.moneycontrol.com/news/business/expect-to-see-20-30-pc-growth-this-year-jabong-ceo_7015101.html
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