Stage Set for Explosive Growth of Apparel Manufacturer, NAKD

Naked Brand Group, Inc. (NASDAQ: NAKD) is set for explosive growth in the apparel manufacturing and marketing sector when it completes its planned merger with New Zealand-based Bendon group Holdings Limited.

NAKD manufactures and markets a line of high-end innerware that is marketed through retailers such as Nordstrom (NYSE: JWN).  Its product line has been expanded by renowned designer and sleepwear pioneer Carole Hochman, who joined Naked Brands as Chief Executive Officer, Chief Creative Officer and Chairwoman in 2014.

Since taking the helm, Hochman has done an impressive job in growing sales – and margins.  Now, it appears that her talents – and contacts, will blossom with the Bendon merger that will open up the apparel market for expanding sales.

Bendon is the pioneer in women’s intimate apparel, having invented colored under garments decades ago.  The Company carries an impressive line of products as well, including Hedi Klum intimates, swimwear and menswear. Other top brands are Fredricks of Hollywood and Stella McCartney lingerie and swimware. It also operates 60 retail stores across New Zealand and Australia.

With such a large stable of women and men’s apparel, once the merger is completed NAKD will be in full swing – and so will its shares.

Explosive Growth

Naked Brands is facing a boom in sales by as much as FIFTY TIMES OR MORE when the Bendon merger is completed.  That boom will most likely lift NAKD shares to new highs.  The deal could also make NAKD the fastest growing apparel manufacturer in the U.S. in 2018.

Fashion is a $1.2 trillion global industry, with more than $250 billion spent annually on fashion in the United States, according to industry analysts.  Since 2009, textile and apparel manufacturing in the U.S. has grown steadily from $65.9 billion to $77.6 billion and its not expected to slow.

Over the past year, the textile and apparel manufacturing sector has out-paced the S&P 500, rising 24.3% as compared to the S&P’s 17.3% (see chart, below).

In an S&P Industry Survery released in January 2018, the analyst says “geographical diversity” has hurt firms, which FT interprets to say a Bendon/NAKD merger will do just the opposite.  Yet in the U.S., “innovative products” are seen by S&P as a key component of growth.

S&P forecasts 5.4% growth for apparel manufacturing in 2018, which NAKD has FAR EXCEEDED.  That says a lot for Naked Brands product lines.

In recent years, globalization has become an increasing trend in the textile and apparel manufacturing industry, which places NAKD in a top position in intimate and under garment wear worldwide when the Bendon merger is completed.

Top Comparables: Too Late To Invest In, But A Great Study


 

 

 

Under Armour, Inc. (UAA)
NYSE: UAA
Market Cap: $6.58B

Under Armour, Inc., together with its subsidiaries, develops, markets, and distributes branded performance apparel, footwear, and accessories for men, women, and youth primarily in North America, Europe, the Middle East, Africa, the Asia-Pacific, and Latin America. The company offers its apparel in compression, fitted, and loose types to be worn in hot, cold, and in between the extremes. It also provides various footwear products, including running, basketball, cleated, slides and performance training, and outdoor footwear.


 

 

 

 

Guess’, Inc. (GES)
NYSE: GES
Market Cap: $1.23B

Guess?, Inc. designs, markets, distributes, and licenses lifestyle collections of apparel and accessories for men, women, and children. It operates through five segments: Americas Retail, Europe, Asia, Americas Wholesale, and Licensing. The company’s clothing collection includes jeans, pants, skirts, dresses, shorts, blouses, shirts, jackets, knitwear, and intimate apparel. It also grants licenses to manufacture and distribute various products that complement its apparel lines, such as eyewear, watches, handbags, footwear, kids’ and infants’ apparel, outerwear, swimwear, fragrance, jewelry, and other fashion accessories.


 

 

 

 

Ralph Lauren Corporation (RL)
NYSE: RL
Market Cap: $8.81B

Ralph Lauren Corporation designs, markets, and distributes lifestyle products worldwide. The company operates in three segments: North America, Europe, and Asia. It offers apparel, including a range of men’s, women’s, and children’s clothing; accessories, which comprise footwear, eyewear, watches, fine jewelry, hats, belts, and leather goods, such as handbags and luggage; home products consisting of bedding and bath products, furniture, fabrics and wallpapers, lightings, paints, tabletops, and giftware; and fragrances.

Turn Your Attention To NAKD – The PacMan of Apparel Manufacturers

Naked Brand Group, Inc. is poised for explosive growth when its Bendon merger is complete.   Bendon itself forecast over $200 million in sales worldwide upon closing the NAKD deal.  That kind of growth would put NAKD at the TOP OF THE MARKET, outpacing many of the leading apparel manufacturers.

While top manufacturing and marketing companies dominate the apparel manufacturing space, the industry in the U.S. is widely scattered, which opens the market for NAKD to continue to gobble up apparel manufactures like PacMan..  A lot of that M&A action is aimed at niche, quality brands that fall under NAKD’s portfolio of brands of apparel.  In fact, NAKD will be one of the most diversified intimate and under garment apparel manufacturers in the U.S.

Don’t rule out retail chain acquisitions either, as many U.S. apparel retailers have suffered during the recession.  That makes for OPPORTUNITY for Naked Brand Group, Inc. seasoned management team.

Suffice it to say that FT sees NAKD as a triple-bagger for its readers with a strong possibility of even higher gains in the near-term.

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Clare Roy

Clare Roy

Clare is a graduate of the New York’s Graduate School of Journalism

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