& Sagar Malviya, The Economic Times
Mumbai, 3 January 2017
Leading Indian womenswear
brands bucked the slowdown trend on the back of mostly younger
consumers shifting from tailor-made to ready-to-wear stylish designs at
affordable rates and discounts. Makers of ethnic brands in the country
— TCNS Clothing (maker of W and Aurelia brands), BIBA, House of Anita
Dongre (AND and Global Desi brands), and Ritu Kumar — all posted 14 per
cent-64 per cent year-on-year jump in their revenues last fiscal, even
as the overall Indian apparel market slipped to single-digit growth at
8 per cent.
Sales of these four companies put together equals that of the apparel
sections retail chains Shoppers StopBSE -0.51 % and Lifestyle
International that sell around a hundred brands, and are more than
Tata's Westside. In fact, with combined sales of Rs 1,600 crore in the
year to March 2016 as per their annual filings, these companies have
nearly doubled their business in the past two years.
"Consumers no longer are stuck to the idea of compartmentalising ethnic
wear and western wear as strictly as we think it is. There is a growing
market for contemporary Indian wear, which cuts across all product
segments," said Anant Daga, CEO at TCNS Clothing.
The maker of W and Aurelia brands, which posted a 65 per cent growth in
sales for FY16 at Rs 591 crore, is expecting a threefold jump in
revenues in five years.
Experts say there’s good growth opportunity as branded women’s apparel
is an extremely under-penetrated category and that is changing
of women taking up ready to wear earlier was smaller, which is now
picking up. Also, younger women are preferring to go out wearing
something which addresses both traditional aesthetic and the work
environment," said Devangshu Dutta, chief executive at retail
consultancy Third Eyesight.
This growth potential has helped TCNS Clothing, BIBA, House of Anita
Dongre and Ritu Kumar — which are nearly two decades old or more —
attract private equity investments in the past three years. While
Everstone Capital picked a minority stake in Ritu Kumar for Rs 100
crore ($16.6 million), Warburg Pincus and Faering Capital invested
about Rs 300 crore to buy a stake in BIBA Apparels. General Atlantic
has picked up a significant minority stake in AND Designs for around Rs
150 crore. More recently, US-based private equity firm TA Associates
invested about Rs 937 crore in TCNS Clothing.
Experts said companies can now easily support
changing trends with investment in product innovation and reach. Indian
wear, initially largely restricted to the older age segment, now finds
acceptance among younger consumers.
That's because most companies now sell fusion clothing — a mix of
modern and traditional wear — instead of just ethnic, which are
reserved for special occasions.
Another growth trigger is growing popularity of online shopping that
has helped these brands reach out to customers in smaller cities.
Online retailing now accounts for 10-15 per cent of their sales.
While online added to overall sales, companies aren't necessarily
enthused because of discounts. "We have been able to curtail ecommerce
growth to a large extent as we believe in selling full price
merchandise rather than going into the discount," said Bijit Nair,
president – retail at House of Anita Dongre. "But the new found
availability due to geographical presence is helping too," he said.
Siddharth Bindra, MD at BIBA, said, "We have got bigger stores and more
locations. Our product ranges have evolved. We also brought larger
heavier collections and collaborations with designers which did very
well." BIBA posted sales growth of 15 per cent at Rs 441crore in FY16.
in The Economic Times)