Aditya Birla Fashion and Retail Ltd. (ABFRL) is on an expansion spree as it plans to open more than 500 stores this year, which is nearly three times its average annual expansion.
Each of its top brands such as Louis Philipe, Van Heusen, Allen Solly and Peter England generates Rs. 1,000 – 1,500 crore annually.
At a time when the overall economic slowdown has made most retailers go slow on increasing bricks-and-mortar network and alter focus to online and e-commerce, the company bets on shifting consumer preferences from the unorganised market to branded apparels.
Ashish Dixit, Managing Director, ABFRL says “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. 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.”
The company acquired Jaypore.com and 51 per cent stake in Finesse International Design, which runs bespoke apparel retail brand Shantanu & Nikhil, to enter the premium ethnicwear segment.
The same-store sales growth of company’s lifestyle brand division was 15 per cent, which was reported as one of its highest ever during last quarter.
On the other hand, Pantaloons that opened over 40 stores in a year, recorded operating profit with margins crossing 10 per cent that almost nears Rs. 109 crore for the first time, with annual sales of Rs. 8,117 crore in FY19.
The company will put a 12-season inventory model that brings freshness to the assortment mix allowing trade partners to right stock inventory.
ABFRL has a strong presence across product categories such as men, women and kids apparels, largely restricting to westernwear formats. But it is giving tough competition to global fashion brands such as Zara, H&M and Vero Moda through the group’s lower priced westernised clothing in their market.