Omni-channel jewellery retailer CaratLane on Friday appointed Avnish Anand as its new chief executive, roughly a week after the departure of its founder and CEO Mithun Sacheti.
Anand was previously chief operating officer of the Tata Group-owned CaratLane and has been at the firm for more than 8 years. “Avnish… was employee No.1 at CaratLane and an integral part of the founding team. He has played a stellar role in building CaratLane into what it is today,” the firm said in a statement.
On August 19, ET reported that Tata group company Titan was acquiring a further 27.18% stake in CaratLane Trading from Mithun Sacheti and his family for Rs 4,621 crore in cash. Titan now owns 98.28% of the firm.
The transaction with Titan marked the second-largest exit for an ecommerce founder in India after Flipkart founders Sachin and Binny Bansal sold their stakes in the company to Walmart. Titan is also expected to buy employee stock options (ESOPs) held by CaratLane employees for around Rs 340-350 crore, or approximately $42 million. The company has around 1,700 employees, and its ESOP pool holds around 1.5% stake.
Titan had first bought a 62% stake in CaratLane in 2016 at a valuation of about Rs 563 crore. Between 2016 and 2019, it bought shares of the omnichannel retailer in tranches, spending a total of Rs 440-450 crore, mainly through secondary purchase of shares from Tiger Global, the only venture investor in CaratLane.
The deal, which came after months of negotiations, pushed up CaratLane’s valuation to Rs 17,000 crore, or about $2 billion, from Rs 563 crore in 2016 when Titan first acquired a majority stake in CaratLane.
On August 23, CaratLane challenged a show-cause notice (SCN) from the Directorate of Enforcement (ED) alleging that it had violated rules between 2011 and 2014 by receiving foreign direct investment (FDI), said people with knowledge of the matter.
The Chennai-based company has been reporting a positive profit before tax number for the last three years, growing at a 55% compound annual growth rate (CAGR) over a five-year period.
In the June quarter of FY24, CaratLane saw a 32.4% year-on-year jump in revenue to Rs 640 crore, with earnings before interest and taxes (EBIT) standing at Rs 35 crore – an EBIT margin of 5.5%. The company added 11 stores in the quarter, taking the store count to 233 spread across 93 cities in India.
