In this edition, we look at the discount retail segment that has proved to be a strong investment thesis for investors such as Creador; India’s local LPs backing evergreen and resilient themes; and the growing appetite for continuation vehicles.
PE sees billions [of dollars] in value stores
The recent initial public offering of Malaysian dollar store chain Eco-Shop made headlines as the country’s largest IPO this year, raising RM 974 million ($230 million), and giving Malaysia-based private equity investor Creador an exit within six years of acquiring a 10% stake.
That is not too far from another discount store that Creador had in its portfolio. In 2016, the firm invested in Malaysia’s Mr D.I.Y stores through its third fund. In 2020, Mr D.I.Y. raised RM 1.5 billion ($353.4 million) in its Malaysia IPO, also a blockbuster that year. Last year, the Indonesian unit, which was part of expansion efforts under Creador, raised some 4.16 trillion rupiah ($260.2 million) in its market debut.
Creador is also invested in the Philippines’ DALI Stores, through its fourth fund.
It is easy to see the appeal in such mass market retail or discount stores. They provide a vast range of goods – from essential groceries and homewares, to more discretionary beauty and cleaning products and pet care – targeted at a diverse base of cost-conscious consumers.
