Aditya Birla Fashion and Retail posts highest ever Quarterly Revenues

Aditya Birla Fashion and Retail has posted yet another outstanding quarterly performance. The company posted its highest-ever quarterly sales in Q2FY23 at Rs. 3075 Cr, up 50% YoY and 33% over pre-COVID levels. Strong performance across business segments led to a 24% YoY growth in EBITDA to Rs.418 Cr. Robust Like-to-Like and consistent E-commerce performance have been key drivers of growth in the quarter.

The key highlights of the quarterly performance are as follows:

• Aggressive network expansion across brands, with Pantaloons adding 21 stores on a net basis and the Branded business adding 85 stores.
• E-commerce sales grew 24% YoY across the portfolio
• Consistent enhancement of Omni-channel coverage at over 1600 stores
• Closed the quarter with net debt of Rs. 243 Cr. at consolidated level against Rs. 504 Cr. at the end of March’ FY22.
• Lifestyle Brands: Best quarter for the branded portfolio as revenue grew 45% YoY (34% over pre-COVID levels) to reach Rs. 1680 Cr on the back of industry-leading retail L2L growth of 27%.
• Pantaloons: Business achieved highest-ever quarterly revenues to grow 64% YoY to Rs. 1094 Cr. EBITDA margins now ahead of pre-COVID levels.
• • Lifestyle brands – Best quarter for the branded portfolio as revenue grew  45% YoY (34% over pre-COVID levels) to reach Rs. 1680 Cr on the back of industry-leading retail L2L growth of 27%. EBITDA surged 52% YoY to  Rs.286 Cr. The quarter also marked solid traction for the Women’s and kid’s  wear business portfolio as it achieved the highest-ever quarterly revenue. The business continued with its focus towards building the growth engine of  small-town stores, with a network of ~550 stores across brands.  
  • Pantaloons – Business achieved highest-ever quarterly revenues to grow  64% YoY to Rs. 1094 Cr. E-commerce grew 20% YoY on the back of robust  festive sales on the app and the website. EBITDA margins were ahead of  pre-COVID levels, mainly led by sharp markdown reductions and better  value realisations. Pantaloons celebrated its 25th anniversary with its  customers through several campaigns across the country.

    Robust Like-to-Like and consistent E-commerce performance have been key  drivers of growth in the quarter. The period also saw an increase in marketing investments post a hiatus of more than 2 years since COVID, as the company  reinvigorated its focus towards brand building and strengthening consumer  connect. 

    Each of the business segments posted strong performance.   

  • Inner wear & athleisure segment achieved 27% revenue growth YoY.  The business continued to expand its network by adding ~1400 new trade outlets and 31 retail outlets to exit the quarter with ~30400 trade outlets  and 111 stores. 
  • Youth Fashion segment consisting of American Eagle and Forever 21, continued to show robust growth of over 50% YoY. 
  • Super premium brands, comprising of the multi-brand format “The  Collective” and other super-premium brands, continued the strong  momentum with revenue growing 35% YoY. E-commerce revenue witnessed 100% growth over the same quarter last year. 
  • Ethnic businesses grew ~ 90% YoY (9x over pre-COVID), driven by both network expansion and category extensions. The brand “Sabyasachi” opened  its first-ever exclusive brand store in New York. Men’s premium ethnic wear  brand Tasva continued its aggressive expansion targeting to end this year  with ~70 stores. 

  OUTLOOK 

  Driven by a buoyant demand outlook and an encouraging start to the festive  season, ABFRL remains optimistic about the overall consumption of fashion  products for the rest of the year. Accelerated urbanization, sustained income  growth and the need for a sophisticated shopping experience augur well for  ABFRL’s portfolio of brands. Through millions of loyal customers, a proven 

  execution track record, the strength of its brands and a comprehensive portfolio  play, ABFRL continues to see strong growth opportunities ahead. With a strong  balance sheet, ABFRL is well poised to make the most of this opportunity as it  cements its leadership position in the Industry. 

The table below captures the financial performance at a glance.