Aditya Birla Fashion looks to clock in 15 per cent growth

Aditya Birla Fashion and Retail (ABFRL) which has a huge portfolio of brand under it feels newer brands along with the existing ones would give cohesive growth to the company’s revenues, which are expected to grow at a CAGR of 15 per cent and return on capital employed expansion to 14.6 per cent (against 2.4 per cent currently).

ABFL has a portfolio across price points, categories and market channels. These include mass to luxury, men’s, women’s and children’s wear and accessories and multi brand outlets, exclusive brand outlets and shop in shops. It offers 5,000 styles and more than 200 brands with a a pan-India distribution of 2,261 EBOs outlets spanning 6.2 million square feet covering 375 cities and towns. Some brands under it are: Ted Baker, Simon Carter and Forever 21. Increased share of private labels (61 per cent versus earlier 45 per cent) has resulted in a 300 bps expansion in EBITDA margins to five per cent in FY17.

Moderation of prices (around 10 per cent), along with a change in inventory cycle from two to four seasons and launch of brand extensions, would revive like to like growth to five to six per cent in Madura. Cumulatively, Madura's revenues are expected to grow at a CAGR of 13 per cent in financial year 2017-’19.