Three Aditya Birla apparel brands zoom past Rs1,000 crore in revenue


July 13, 2015

Sapna Agarwal, MINT

Mumbai, 13 July 2015

Three brands from Madura Fashion and Lifestyle, a unit of Aditya Birla Group company Aditya Birla Nuvo Ltd, crossed the Rs.1,000 crore revenue mark in terms of consumer price in fiscal 2015. Fiscal 2016 will see two brands from Arvind Ltd’s retail unit Arvind Lifestyle Brands Ltd cross the same milestone.

Consumer price is the price at which the product is sold to the consumer. It could be lower than the maximum retail price (MRP) as it takes discounts into account.

“More and more brands are now crossing the Rs.1,000 crore mark. In the next two-three years, we will have at least 10 brands of this size,” said Devangshu Dutta, chief executive officer, Third Eyesight, a retail consultancy firm, pointing to brands such as Levi’s, Benetton and Zara.

It took brands such as Louis Philippe, Van Heusen and Peter England, from Madura Fashion and Lifestyle, 10-15 years to get to Rs.500 crore. However, their journey towards revenues of Rs.1,000 crore happened in less than five years, said Ashish Dixit, president, Madura Fashion and Lifestyle, who now expects it to take even less time for them to get to Rs.1,500 crore. Louis Philippe will reach Rs.1,500 crore in revenues next year, said Dixit, adding that in the next two to three years, the company will have three Rs.1,500 crore brands in its portfolio.

From Arvind Lifestyle’s portfolio, US Polo and Arrow have revenues of close to Rs.850 crore and will reach Rs.1,000 crore this fiscal year, said chief executive J. Suresh.

Brands are reaching the Rs.500 crore mark in a shorter time now and scaling to Rs.1,000 crore from there even faster, said experts.

Los Angeles-based Forever 21, launched in India two years ago, will reach Rs.500 crore in fiscal 2016, said Dipak Agarwal, chief executive of DLF Brands Ltd, the joint venture partner for the brand in India. From there, it will be another three years for the brand to hit Rs.1,000 crore revenue, said Agarwal.

Currently, there are nine Forever 21 stores in India and the retailer plans to add five to six every year. On average, each Forever 21 store does business of Rs.35 crore per year, said Agarwal.

Last year, Arvind Lifestyle also announced partnerships with US retailer Gap Inc. and speciality retailer The Children’s Place.

“Weare targeting revenues of Rs.1,000 crore for Gap and Rs.500 crore for The Children’s Place in the next four to five years,” said Suresh in an earlier interview to Mint.

Inditex Trent Retail India Pvt. Ltd, the joint venture between Inditex SA and Tata Group company Trent Ltd for retail chain Zara in India, posted 24% annual growth in sales for the year ended March 2015 at Rs.721 crore ($114 million), The Economic Times said on Friday, citing Trent’s annual report released on Thursday.

Zara, which has been in the country for five years, could be one of the first international brands to hit the Rs.1,000 crore mark, said Dutta.

To be sure, some brands, such as Benetton, have franchises in India and hence report their sales at wholesale value, which is lower than the sales of brands that report at MRP or consumer price, such as Zara.

(Published in MINT.)