Walmart-owned Flipkart announced on Thursday that it has bought an equity stake in fashion brand Universal Sportsbiz Pvt. Ltd. (USPL), as it looks to strengthen its fashion portfolio.
Although the e-tailer did not disclose the financial details of the investment, it said that it will work in tandem with the Bengaluru-based company to deepen product offerings on its e-commerce platforms.
USPL is a youth-focussed fashion brand that owns brands such as Wrogn, Single, and Ms.Taken. This is Flipkart's third significant investment in an offline fashion retailer this year. The company recently invested Rs 1,500 crore in Aditya Birla Fashion and Retail Ltd. (ABFRL) to pick a 7.8 per cent stake. It also acquired a stake in Arvind Youth Brands, the owner of the Flying Machine brand, in July this year for Rs 260 crore.
"This is a Series F funding for USPL from the Flipkart Group along with participation from existing investor Accel Partners. This investment will significantly step-up the online strategy of USPL by strengthening the existing long-standing engagement between USPL and Flipkart Group," Flipkart said in a statement.
In October 2018, Universal Sportsbiz Pvt Ltd (USPL) had announced raising $13.5 million (around Rs 100 crore) from investors, valuing the company at around Rs 1,200 crore. The series E funding saw participation from investors including Accel Partners and Alteria Capital Advisors.
On Tuesday, Flipkart had announced the acquisition of intellectual property from Mech Mocha for an undisclosed amount to strengthen its gaming strategy.
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These investments are expected to help Flipkart gain a bigger foothold in the Indian market as it battles it out with rival Amazon and billionaire Mukesh Ambani-run Reliance Industries, which is rapidly expanding its retail business via major acquisitions and large-scale funding from overseas investors, including Silver Lake and KKR.
Founded in 2015, USPL has built a portfolio of premier youth-focused fashion brands for young Indians, including Imara (women's ethnic wear brand), Ms.Taken (women's western wear brand), Single (men's casual wear brand), and Wrogn Active (men's athleisure line).
USPL's flagship brand, Wrogn is a men's casual wear brand that has been among the leading brands on Myntra (Flipkart group company) over the last few years, the statement said.
USPL brands are also present in over 750 offline retail outlets in more than 100 cities across India and USPL has been growing at 40-50 per cent year-on-year.
"The last few months have provided a great opportunity for us to consolidate our market leadership among homegrown brands catering to the youth and expand our market share. Post-pandemic recovery has been great for us and we are at about 80 per cent of pre-COVID sales," Anjana Reddy, Founder and CEO of USPL, said.
Reddy added that as the world is moving towards omni-channel retailing, the company can significantly strengthen its online strategy by working with Flipkart and Myntra, two prominent players in the Indian online fashion space.
"USPL's unique brands, backed by celebrity endorsements, have a strong appeal for the young fashion-driven Indian consumer. This investment will help USPL and the Flipkart Group find deeper synergies as we continue on our commitment to grow an ecosystem of partnerships that deliver value for consumers and brands," Flipkart Group CEO Kalyan Krishnamurthy said.
(With inputs from PTI.)