The fashion and lifestyle (F&L) business of Reliance Retail (RRL) looks to expand its footprint with new formats and in-house brands to cash in on the rising sales in the physical stores. The retailer on Thursday launched a premium fashion and lifestyle store chain Azorte, which will focus on global trends and contemporary Indian fashion. RRL has also relaunched Future Group’s department store format Central as Centro in the locations where the lease was taken over by the former.
According to an executive the sales at the fashion stores picked up mainly because of festivities, wedding season, and the opening up of mall stores. “We want to offer products to every socioeconomic segment in the society with various store formats and categories of products,” he said. The retailer’s F&L business grew three times in the first quarter, as the footfall increased in their stores. “The consumers refreshed wardrobes as the Covid impact reduced and school, offices and restaurants came back to pretty much pre-covid level of activities,” Gaurav Jain, head (strategy and business development) at Reliance Retail, said in a post-earnings analysts’ call.
RRL’s grocery, consumer electronics, and pharma businesses also nearly doubled during the first quarter. The digital and new commerce business grew double over the last year’s same period and the contribution of these channels stood at 19% of gross revenues. RRL’s net profit rose 114% to Rs 2061 crore in the first quarter while revenue expanded 54% to Rs 51,582 crore. The earnings before interest, tax, depreciation and amortization (EBITDA) were at Rs 3837 crore, up by 98%. The EBITDA margin from operations was at 7.6%, which improved 350 basis points year-on-year. Overall, RRL opened 792 stores in Q1, taking the total store count to 15,866 stores. It added nearly 4 million sq ft space in the quarter. It also added 79 new warehouses and fulfillment centers to enhance our service capabilities.
“The in-house brands business has been scaled up six times year-on-year (Y-o-Y), and we continue to look at wider and deeper general trade penetration across geographies. We are also undertaking nationwide campaigns to build these brands across geographies,” said Jain. The F&L division operates formats like Trends, Trends Man, Trends Woman, Trends Kids, Trends Footwear, and online platform AJIO, besides the recently launched Azorte and Centro. In addition, it has partner brand stores. The Trends stores cater to mass to mass premium segments.
Azorte is a premium fast fashion store with a complete focus on in-house brands. Centro is also a premium but a departmental store with over 300 brands and many more categories. In the fashion business, the retailer entered into deals with brands like Satya Paul, Ritu Kumar, Raghavendra Rathore, ak-ok (Anamika Khanna), Manish Malhotra and collaborating with Rahul Mishra. It also announced deals with Abraham & Thakore and Sandeep & Abu Jani. It bought stakes in brands like Zivame, Amante and Kalanikethan.