The firm that runs brands such as Louis Philippe and Pantaloons is betting on consumers shifting from the unorganised market to branded apparel. The company said its growth has so far remained unaffected by newer rivals as each of its top brands generate Rs 1,000-1,500 crore in annual sales, each bigger than fast fashion rivals.
Aditya Birla Fashion and Retail, the country’s largest clothing firm, plans to open more than 500 outlets this year, nearly three times its average annual expansion, at a time when the overall economic slowdown has made most retailers go slow on increasing brick-and-mortar network and shift focus to online.
The firm that runs brands such as Louis Philippe and Pantaloons is betting on consumers shifting from the unorganised market to branded apparel.
“The general consumption habits are changing, especially in a digitally connected network, when you are seeing desire for brands and aspiration for better quality products,” said Ashish Dikshit, managing director at Aditya Birla Fashion and Retail (ABFRL) that runs more than 3,000 outlets. “There is a very large upgradation and movement to buy brands and the opportunity in a country like India will keep emerging from new markets.”
With liquidity stress persisting in wholesale channels, most retailers across consumer products, liquor and apparel have been facing pressure to push inventory in smaller towns and hinterland.
Experts said the underlying situation hasn’t dramatically improved due to liquidity issues and there is still nervousness in terms of stocking up.
“The wholesale business appears to be undergoing some structural shift triggered by liquidity issues in the economy and management (of ABFRL) is strategising to invigorate the same whilst simultaneously speeding up exclusive brand outlets (EBOs) expansion, including conversion of some large wholesalers into EBOs,” JM Financial said in a recent investor note.
The company said its growth has so far remained unaffected by newer rivals as each of its top brands — Louis Philippe, Van Heusen, Allen Solly and Peter England — generate Rs 1,000-1,500 crore in annual sales, each bigger than fast fashion rivals.
It now plans to launch a new mass-market ethnic wear brand. “One of the segments we have always sort of stayed away from was ethnic wear because we thought it was fragmented, (and that the) ability to build brands will be lower,” said Dikshit, who started his career in the group 25 years ago. “We (have now) realised we are missing on a very large opportunity. Women’s wear is 40% of the overall apparel market, and three-fourths of that is traditional.”
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