New-age men’s apparel and fashion brand Rare Rabbit is set to close its first-ever institutional funding round, of Rs 500 crore, reported The Economic Times.
This Rs 500 crore investment round is being led by A91 Partners, with participation from key figures like Ravi Modi, the brain behind Vedant Fashions that steers ethnic fashion brand Manyavar, and Nikhil Kamath, the co-founder of Zerodha.
The report quoted people aware of the funding and said that Modi’s family office and Kamath are likely to fund around Rs 150 crore into the venture collectively, while A91 will contribute the remaining Rs 350 crore.
The transaction involves about Rs 250 crore as primary capital inflow into the company, with the balance being a secondary share sale by Akshika and Manish Poddar, the husband-wife duo behind Rare Rabbit.
Valued at an estimated Rs 2,200 crore, Rare Rabbit, which has been self-funded thus far, stands as one of the most talked-about direct-to-consumer (D2C) brands in the fashion arena.
The fashion brand had been in talks with Tata Capital for funding last year, but the funding round could not be closed as negotiations fell through.
Rare Rabbit reported a revenue of over Rs 600 crore in fiscal 2024, accompanied by an operating profit surpassing Rs 100 crore as per the report.
This represents a remarkable growth trajectory, with a revenue surge of over 60% year-on-year compared to FY23’s operating revenue of Rs 376 crore.
According to industry insiders quoted in the report, the surge in premiumisation has been a major catalyst for growth in the men’s fashion sector over the past couple of years.
Premium brands have seen substantial revenue growth, with segments like formal wear, casual shirts, denims, and trousers experiencing a surge.
Rare Rabbit was established in 2015 under Radhamani Textiles, based in Bengaluru. Initially focusing on apparel manufacturing for global giants like Zara, the company ventured into creating its own brand.
Rare Rabbit, alongside premium women’s fashion brand Rareism and everyday wear brand Articale, emerged as a flagship offering under the House of Rare.
With Manish leading as the creative director for Rare Rabbit and Akshika overseeing Rareism, the brand has flourished, currently operating approximately 135 physical stores.
Plans for aggressive expansion post-funding are underway, particularly targeting Tier-II and Tier-III cities alongside metro areas.
In terms of competition, Rare Rabbit stands alongside established players like Louis Phillippe, Tommy Hilfiger, and Marks and Spencer, each showing good revenue figures.