The latest cosmetics and household goods producer to make a tilt at the ASX reckons rising interest rates and inflation fears aren’t going to stop Australians from filling up their trolleys.
Hiro Brands, chaired by former Myer chairman Garry Hounsell, embarked on a $35 million initial public offer raise last week, offering shares at $1.87 each to bring its suite of cosmetics and cleaning products to the ASX.
Company managing director and CEO, Steven Chaur, is confident the consumer goods sector will remain buoyant, despite talk of tough economic conditions.
The price of food, rent, utilities and coffee have all gone up with Australia’s inflation expected to peak at an annual rate of 7.75 per cent in the December quarter.Credit:istock
“There is still a lot of consumer demand for everyday groceries. The business we compete in is everyday household goods and personal care products — consumers are still demanding those items,” Hiro Brands MD and CEO, Steven Chaur, told The Sydney Morning Herald and TheAge.
Hiro brings together brands from unlisted consumer goods makers, Aware, which makes household products like Orange Power and Organic Choice and Heat Group, which makes brands including MUD cosmetics. These products generated $95.7 million in revenues in 2021, according to prospectus documents, and ran at a $16.1 million loss.
It is also pitching itself to the market as an opportunity to invest in local manufacturing, with the majority of its brands and ingredients being made in Australia.
But as the business hit the road to talk to prospective investors this month, there were no shortage of warnings about consumers’ ability to spend, with top-line inflation hitting 6.1 per cent.
Meanwhile, ASX-listed beauty brand BWX, which Hiro is pitted against in the market, was warning investors that prevailing retail conditions were exerting pressure on the company and its retail partners.
According to Chaur, Hiro is very different from a company to BWX. For one, the business is not just focused on cosmetics and beauty.