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MEXICO CITY  Grupo Axo, the fast-growing Mexican apparel franchiser, is considering an initial public offering in or after 2018 to finance expansion, according to investor relations director Raul Villar.

“We are analyzing the market and looking at the opportunity to list on the stock market, but there are no firm plans yet,” Villar said, adding that the group that brought Tommy Hilfiger and Calvin Klein to Mexico is becoming well-known with domestic and international investors, following several debt offerings.

With its motto of “Moving people closer to the brands they love, in a way nobody has ever imagined,” Axo licenses and distributes nearly 20 foreign lifestyle brands in Mexico and increasingly South America. They include Abercrombie & Fitch, Brooks Brothers, Emporio Armani and, most recently, Crate & Barrel.

Fitch expects Axo’s revenues will rise 15 percent annually over the next two years while earnings before interest, taxes, depreciation and amortization margins will hover at 14 percent. In the past four years, the company’s annual revenues rose 30 percent, up from a 14 percent average for rivals, Fitch said, adding that rising competition will dent growth.

Axo in January sold 800 million pesos, or $41 million, worth of bonds to fund growth calling for 30 to 40 store openings annually, mainly in Mexico, but also in Chile, Peru and other Latin American nations. Axo insiders said U.S. buyout fund Evercore, which owns 20 percent of Axo, could make an exit in the next 12 to 48 months, boosting the case for a share listing on the Mexican Stock Exchange.

Restaurant group Alsea owns another 25 percent of Axo, with the rest owned by private investors.

Operating roughly 2,800 stores, Axo is currently worth 7.2 billion pesos, or $362 million at current exchange, said José Eduardo Coello, an analyst at Ve por Mas brokerage in Mexico City. The estimate is based on Axo’s 2016 EBITDA forecast of 689.8 million pesos, $35 million, or 10.5 times the EBITDA multiple department-store Liverpool recently paid to purchase Wal-Mart Stores Inc.’s clothing division Suburbia for $1.04 billion.

Coello said Axo could command a similar valuation, which is slightly above the 10.1 average multiple of companies listed on the Mexican Stock Exchange.

He added Axo would be better off listing in or after 2018 as investor appetite for stock market listings remains weak due to the peso’s worsening devaluation and uncertainty over the U.S. elections.

A senior investment banker at Actinver, one of the banks that helped place Axo’s debt, said investors will buy its stock.

“It’s an interesting business with a growing international presence and there are similar companies listed globally,” he said, adding that market sentiment is expected to gradually improve next year.

Villar said Axo has “ample” cash to bankroll growth for another two years.

However, given its rapid expansion, it will probably need funding after that, observers said.

Apart from opening 30 to 40 stores a year, Axo could raise revenues by 25 to 30 percent in 2017 to around $300 million once its recent tie-up with PVH Corp., to boost sales of Calvin Klein, Warners and Arrow gains traction, according to Villar.

This year, Axo expects revenues will grow around 15 percent, driven by rising sales of its newly acquired Multibrand Outlets Stores and Victoria’s Secret franchises, for which it just opened its first Mexico and Latin American store. Other labels such as Tommy Hilfiger, Bath & Body Works and Rapsodia are also expected to trade well, Villar said.

In 2015, Axo reported a 58 percent jump in operating profit to 234 million pesos, or $12 million, on a 78 percent revenue surge to 4.5 billion pesos, or $230 million at current exchange.

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