The Body Shop Malaysia retailer plans expansion into Vietnam post IPO

The Body Shop Malaysia franchisee InNature is seeking an initial public offering (IPO) in Malaysia, to raise approximately RM120.6 million. InNature looks to grow its revenue and strengthen its leadership in the mono-brand beauty industry as well as the naturals beauty market.

According to the prospectus document seen by A+M, along with growing its Malaysia presence, InNature looks to venture and grow the Body Shop brand in Ho Chi Minh City with 18 new points-of-sale in Vietnam. InNature will also utilise approximately RM2.0million and RM1.3million of its IPO proceeds respectively to improve its IT network and capabilities of its The Body Shop business operations in Malaysia and Vietnam. It plans to spend a total of RM8.4 million over the course of 36 months from the date of its listing, in renovating some of its existing points-of-sales in these two countries.

Meanwhile, InNature has also been operating the Natura brand in Malaysia through its subsidiary, Ola Beleza. With the IPO proceedings, InNature aims to allocate approximately RM5.7 million to develop the new Natura business in Malaysia within 36 months from the date of its listing. The costs related to the development of the new Natura business are mainly in relation to the marketing expenses budgeted for the launch and introduction of the brand to the market. These include the cost of organising the launch events, costs of printing catalogues, and other promotional materials, cost of distributing the catalogues and samples, and the cost of digital marketing.

As part of its plan to develop the Natura brand in Malaysia, InNature will put aside RM1.5 million of the IPO proceeds to set up the IT infrastructure for this new business which is targeted to complete by December 2020. This includes the cost of integrating the ERP (enterprise resource planning) with Natura's sales and commercial platform for eCommerce and social-selling via a website and mobile application.

For the new Natura business in Malaysia, InNature plans to to open up an average of two points-of-sale per year, totaling up to six new points-of-sale in Malaysia within 36 months from the date of its listing. It has set aside approximately RM4.8 million from its IPO proceeds to do so.

"We will be focusing on an omnichannel strategy heavily focused on Natura’s business model of social commerce and eCommerce, which will be supported by a digital platform as well as physical stores for showrooming and raising awareness through customer experience," InNature said in a statement on the bursa filing.

InNature was incorporated in Malaysia under the Companies Act 1965, on 21 October 1994 as a private limited company and deemed registered under the Act. It assumed the name "InNature Sdn Bhd" in 1 March 2018, and became a public limited company on 25 July 2018, to faciliate its listing. The company has over 35 years of experience in the The Body Shop franchise business since it opened the first store in 1984 at Plaza Yow Chuan, Ampang, in Kuala Lumpur.

Within the cosmetics personal care industry in Malaysia, InNature claims to be a leading mono-brand beauty retailer of this segment with a 11.0% market share based on total market sales of RM1.48 billion as at 2018.