Citykart, a leading value fashion retailer catering to India&rsquo;s tier-II and tier-III markets, has raised ₹538 crore in a fresh funding round led by TPG NewQuest and A91 Partners. The round comprises ₹120 crore in primary capital and ₹418 crore in secondary share sales, valuing the Gurgaon-based retailer at nearly ₹1,400 crore.
The funds will fuel Citykart&rsquo;s expansion into underserved states such as Rajasthan, Jharkhand, Odisha, and Assam, aiming to replicate its strong presence in core markets like Uttar Pradesh and Bihar. The company, which currently operates 137 stores, plans to add 40&ndash;50 new outlets annually.
Founder and Managing Director Sudhanshu Agarwal emphasized a focus on profitable growth and experimentation with new store formats in peri-urban areas of Delhi and Gurugram.
Investcorp Exits with 4x Return
As part of the transaction, Bahrain-based Investcorp made a full exit, realizing a fourfold return on its six-year-old investment. India SME Investments sold half of its stake. TPG NewQuest has now emerged as the largest institutional shareholder, followed by A91 Partners and India SME Investments.
Citykart&rsquo;s revenue has surged by 70% over the past two years and is expected to cross ₹1,300 crore in FY26, up from over ₹900 crore in FY25. The company has been profitable for five consecutive years.
Despite its growth, Citykart&rsquo;s current valuation stands at 1.5 times FY25 revenue&mdash;relatively modest compared to peers like V-Mart (2x) and Vishal Mega Mart (5.4x), the latter benefiting from a broader product mix.
While an IPO is on the horizon, Agarwal noted that Citykart is in no rush. &ldquo;We want to double down on our revenue growth and profitability before thinking about an IPO,&rdquo; he said.
Building Fashion for Bharat
Citykart is betting on rising incomes in small-town India, with a store-first approach and a portfolio of in-house brands such as Athiya, Nimes, Fumee, and Remise. Agarwal highlighted that a 10% income rise in these markets often leads to a 50% jump in disposable income, creating strong tailwinds for affordable fashion.
Commenting on the investment, Bharati Agarwal of TPG NewQuest said, &ldquo;Citykart has demonstrated an exceptional ability to scale profitably in one of the most challenging and underserved segments of Indian retail. We are excited to partner with them in this next phase of growth.&rdquo;
The deal, advised by EY India, marks one of the largest private equity infusions in India&rsquo;s value retail space and underscores growing investor interest in consumption-driven businesses beyond metro markets.
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Source : Indian Startup News

Citykart, a leading value fashion retailer catering to India’s tier-II and tier-III markets, has raised ₹538 crore in a fresh funding round led by TPG NewQuest and A91 Partners.

Citykart Raises ₹538 Crore in TPG NewQuest, A91-Led Round to Expand Value Fashion Footprint