Aditya Birla Fashion eyes Rs 300 crore business from new acquisitions
NEW DELHI: Lifestyle retailer Aditya Birla Fashion Retailer Ltd is planning to build a multi-crore business from its new acquisitions in the traditional wear segment over the next 4-5 years to take on brands such as Manyavar, Biba. The company has recently forayed into ethnic wear by acquiring 100 per cent stake in Jaypore and TG Apparel and also entered into a strategic partnership with designers Shantanu and Nikhil by taking 51 per cent in Finesse.
“It’s just been a couple of months since we acquired the brands that have very different objectives. But, in the next 2-3 years we should be able to bring a meaningful business in both. We are looking at building at least Rs 200-300 crore business in medium-term period,” said Jagadish Bajaj, CFO, Aditya Birla Fashion and Retail Limited, told analysts in a post-earnings conference call.
Launched in 2012, Jaypore currently has two stores and largely sells women’s clothing and accessories online. “The task is to move from online to offline leveraging our distribution strength,” Bajaj explained. On the other hand, the company is working on launching a more affordable range of clothing under the Shantanu & Nikhil brand that now sells more pricey clothing. Also, it will take some time to turnaround Jaypore as it is loss-making, contributing to EBITDA loss of about Rs 10 crore, whereas the other new brand do not have much losses, he said.
In India, ethnic wear is the single biggest category in the women’s wear segment with a share of 71 per cent despite global fashion brands such as Zara, H&M and Vero Moda pushing their westernised clothing in the market. Indian wear, initially largely restricted to the older-age segment, have also found acceptance among younger consumers as companies widened their portfolio to sell fusion clothing, instead of just ethnic, worn during special occasions.
For instance, department chains such as Shoppers Stop, Lifestyle and Westside expanded their private label range and started offering contemporary styling in the ethnic space, fuelling growth.