The Indian wellness and beauty services industry valued at Rs 11,000 crore is getting a fair share of attention from venture capital (VC) and private equity (PE) communities. With less than 5 percent of the market being serviced by organised players, investors are sensing a big opportunity to derive immense value from the sector. According to the Ernst &Young-Ficci Wellness Report 2009, “The wellness and beauty services market, which grew at 30 percent in the last two years despite the downturn, is expected to sustain a growth of 25-30 percent CAGR for the next few years”. YLG (You Look Great),a Bengaluru-based salon chain, started in 2009 by Rahul Bhalchandra and Rajiv Bopaiah, former Future Group employees, has raised Rs20 crore from Helion Ventures, and is now on the lookout for a second round of VC investments. According to industry sources, two other companies, Naturals’ and Enrich Salon, have also been eyeing VC funding and are close to finalising deals. “Funding from PE firms is certainly an option, as is taking on debt from banks. We would be looking at the PE route when making an acquisition or for a project with a high gestation period”, says Sandeep Ahuja, Managing Director, VLCC Health Care.
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