Aditya Birla Fashion And Retail Ltd · NSE:ABFRL
Aditya Birla Fashion And Retail — Investor Presentation (March 2021)
104 slides from Aditya Birla Fashion And Retail's investor presentation, March 2021
Slide 1: Aditya Birla Fashion & Retail Ltd. Corporate Presentation
Aditya Birla Fashion & Retail Ltd. Corporate Presentation March 2021
Slide 2: Executive Summary
Executive Summary 1. Indian Apparel Sector presents large market opportunity – USD 100 bn + by FY 25 2. ABFRL is a pioneer in branded apparel industry, with 30 years of rich experience 3. Over long period of time, we have demonstrated success in Building portfolio of the largest fashion brands in
Slide 3: Apparel Market: One of the largest segments in Indian consumer industry
Apparel Market : One of the largest segments in Indian consumer industry 107 (USD Bn) 67 Apparel Market 55 41 • Projected to grow at a 10% CAGR • Reach ~$107 Bn by FY25 2015 2018 2020E 2025P 2% 3% 4% Rapid shift to Organized Market 10% 26% 27% 29% 31% • Traditional retail losing share • Organized Re
Slide 4: Branded Apparel: Large headroom for growth
Branded Apparel : Large headroom for growth Tier II , III & below – 71% of total (USD Bn) retail spending Top 24 cities (Metro, Mini-Metro & Tier I) – 29% of total retail spending 631 352 90 100 90 90 50 56 50 50 Top 2 Cities Next 6 Cities Next 16 Cities Next 50 Cities Rest of India 2015 2025E Appar
Slide 5: Demographic and Consumption Trends promise Accelerated growth
Demographic and Consumption Trends promise Accelerated growth for Organized Fashion Play Changing Demographics Consumption Megatrends 1 Significant population with Age < 30 years Increase in Brand Consciousness 2 Shift from Rural to Urban Areas Greater participation of Women in Workforce 3 Rising Af
Slide 6: Women's Ethnic, Men's Formal and Men's Casual wear will remain the largest segments
Women’s Ethnic, Men’s Formal and Men’s Casual wear will remain the three largest segments Men’s Apparel Market(1) CAGR 10.3% 2 8.6% 14.2% 3 10.3% 13.6% 8.4% 45.3 21.6 (USD Bn) 27.7 14.3 13.2 6.8 5.7 3.1 3.8 1.9 0.9 1.7 Total Market Size Formal Casual Innerwear Activewear Others 2020E 2025P Women’s A
Slide 7: ABFRL Vision
ABFRL Vision To passionately satisfy Indian consumer needs in fashion, style and value, across wearing occasions in Apparel and Accessories through strong brands and high-quality consumer experience with the ultimate purpose of delivering superior value to all our stakeholders Our Vision has consist
Slide 8: ABFRL Journey
ABFRL Journey Evolution of a Fashion Powerhouse 2017-2020 Portfolio Diversification 2007-2016* Investments in white spaces 1999-2006* Expansion & Growth Phase Fill gaps in apparel offerings and Launch of Innerwear Entry Phase enter multi-brand retail Establish presence in branded Creation of apparel
Slide 9: Consistent Growth Story over the last 15 years
ABFRL | Consistent Growth Story over the last 15 years 8,743 6,633 18.5x in Revenue 15 years (in Rs .Cr.) 3,802 CAGR 1,126 ~21% 472 FY05 FY09 FY13 FY17 FY20 Reported 13x in EBITDA 15 years (in Rs .Cr.) 518 476 CAGR 312 ~19% 39 -166 FY05 FY13 FY17 FY20 FY09 Reported
Slide 10: Powerhouse of Brands
ABFRL | Powerhouse of Brands Diversified portfolio addressing all Consumer Segments Portfolio addressing Luxury varied segments Super- Premium Men’s Women’s Formals – Western – 25% 15% Premium Sub-Premium Men’s Casuals – Innerwear– 3% 42% Value Ethnic – 8% Kids – 7% Home to India’s 5 Leading Apparel
Slide 11: Widest Multi-channel Distribution across the country
ABFRL | Widest Multi-channel Distribution across the country Legend: 2,699 Exclusive Brand Outlets Pantaloons Stores Multi channel distribution built over years Exclusive Brand Outlets 3 16 13 2 83 12 Wide distribution led by deep 342 112 48 7 23 128 14 14 2 1 Pantaloons Stores 110 3 1 understan
Slide 12: Diversification a conscious choice in line with our vision
Diversification a conscious choice in line with our vision Why Portfolio play instead of narrow play Why we can win the Portfolio play A history of successful business Rich incubation; strong parentage Large growth opportunities across Legacy multiple segments Rich expertise in product and Design &
Slide 13: Our success is built on strong, sustainable pillars
Our success is built on strong, sustainable pillars 1 Diversified play 2 Rich Brand Portfolio — Business Models: Brand and Retail — Largest & most loved fashion brands — Price Points: Luxury to Value — Leading Value Fashion retailer — Consumer Segments: Men, women, Kids — Partnership with best Globa
Slide 14: Building an all round sustainable business on key long term trends
We are building an all round sustainable business by focusing on key long term trends 1 Digital Transformation 2 ESG 3 14 4
Slide 15: Comprehensive Digital Transformation program
We are executing a comprehensive Digital Transformation program 1. Drive Revenues - Commerce Omni-channel Digital in- Channel E-Commerce store partner mgmt. 2. Build Stronger Brands: Engagement Personalization Digital marketing 3. Improve profitability: Efficiency Improvement Markdown Design, buying
Slide 16: Our E-commerce Strategy
Our E-commerce Strategy will leverage the existing eco- system and build own captive capabilities & assets 1. Ecosystem Partnerships – Leverage partnership with leading fashion E -commerce players Wider assortment and enhanced service levels Extend brands into new online-heavy categories Launc
Slide 17: ABFRL is a pioneer in ESG in Indian apparel industry
ABFRL is a pioneer in ESG in Indian apparel industry Consistent sustainability journey spanning over a decade Sustainable Product – At ABFRL, we follow strict sustainability guidelines, and even use these to give preference to vendors which align with our sustainability ideologies We are committed
Slide 18: Recognized as Asia's most sustainable fashion Company
Recognized as Asia’s most sustainable fashion Company Among the most S&P Global Corporate sustainable Sustainability Assessment -2020 companies in India for sustainability Asia’s most sustainable assessment in joint research of Business company in textiles, apparels World India and and luxury goods
Slide 19: Leadership Team
Leadership Team Experienced Team, Decentralized Structure Ashish Dikshit Jagdish Bajaj Sangeeta Pendurkar Vishak Kumar Managing Director Chief Financial Officer CEO, Pantaloons CEO, Madura Fashion Total Years of Experience: 29 Total Years of Experience: 31 Total Years of Experience: 32 Total Years o
Slide 20: Lifestyle Brands
LIFESTYLE BRANDS
Slide 21: Lifestyle Brands: India's Strongest Brand Portfolio
Lifestyle Brands India’s Strongest Brand Portfolio • Strong brand equity Versatile ever-growing brands • Evolving with consumer trends • Across segments, usage occasions • Scalable and asset light Industry leading distribution • Large headroom for growth • Consistently profitable with 50%+ ROCE Stro
Slide 22: Lifestyle Brands: India's Strongest Brand Portfolio
Lifestyle Brands India’s Strongest Brand Portfolio • Strong brand equity Versatile ever-growing brands • Evolving with consumer trends • Across segments, usage occasions • Scalable and asset light Industry leading distribution • Large headroom for growth • Consistently profitable with 50%+ ROCE Stro
Slide 23: Louis Philippe
Louis Philippe To inspire the quest of excellence FORMALS SPORT JEANS ATH. WORK | ATH.PLAY Formal: 52% Casuals: 48%
Slide 24: Allen Solly
Allen Solly To encourage you to explore your unconventional vibrant self Formal: 5% Casuals: 95%
Slide 25: Van Heusen
Van Heusen To make professionals fashionable Formal: 55% Casuals: 45%
Slide 26: Peter England
Peter England To bring alive authenticity and trust in our relationships Originals Select Sport Pete Active Mainline Formals Premium Formals Smart Casuals Jeans Lifestyle Active wear Formal: 45% Casuals: 55%
Slide 27: Evolved our brands in line with Consumer Trends
Evolved our brands in line with Consumer Trends Share of casual business grew from 34% to 59% for Lifestyle Brands NSV (INR Crs) Casual 59% Casual 62% 2,455 Cr. Casual Formal 34% Formal 259 Cr. 2,036 Cr. Formal 514 Cr. FY10 FY20 FY22 Likely
Slide 28: Lifestyle Brands: India's Strongest Brand Portfolio
Lifestyle Brands India’s Strongest Brand Portfolio • Strong brand equity Versatile ever-growing brands • Evolving with consumer trends • Across segments, usage occasions • Scalable and asset light Industry leading distribution • Large headroom for growth • Consistently profitable with 50%+ ROCE Stro
Slide 29: Highly scalable asset light distribution model
Highly scalable asset light distribution model Driven by partnerships Company Owned Stores Total Retail Network • Only Company owned stores are with own capex • Fastest retail expansion in FY20 2385 • Franchisee led EBO expansion 2243 1613 • Omni-channel live across 800+ stores 413 435 312 FY15 FY20
Slide 30: Large headroom available to double retail presence
Large headroom available to double retail presence Riding on the growth of both urban and small town India EBO Presence and Future Opportunities Current New Markets for expansion Brands Current Stores Towns (next 5 years) LP 407 175 500 VH 354 163 500 AS 300 145 750 PE 1014 450 2000
Slide 31: Tapping the 'Bharat' Opportunity | Peter England Red
Tapping the ‘Bharat’ Opportunity | Peter England Red Through a Profitable, Asset Light Model What is PE Red? What is the ambition? • Exclusive format for Tier 4-5 towns Over Next 3 years – To build Rs 900 Cr business spread • Asset light, 100% Franchisee led across 1000 Stores • Quality product @ Va
Slide 32: Tapping the 'Bharat' Opportunity | Allen Solly Prime
Tapping the ‘Bharat’ Opportunity | Allen Solly Prime Proof of concept established, Ready for rapid scale up • Penetrating Small Town Objective • Target to open 500 stores in 3 years • Strong Aspirational brand with high Need Gap price value equation Expansion • Own the State and go deep Strategy Pil
Slide 33: Lifestyle Brands: India's Strongest Brand Portfolio
Lifestyle Brands India’s Strongest Brand Portfolio • Strong brand equity Versatile ever-growing brands • Evolving with consumer trends • Across segments, usage occasions • Scalable and asset light Industry leading distribution • Large headroom for growth • Consistently profitable with 50%+ ROCE Stro
Slide 34: Lifestyle Brands Strong Financial Model
Lifestyle Brands Strong Financial Model (INR crs) FY17 FY20N FY26 Revenue 3,651 4,800 ~ 9,000 Growth (CAGR) 10% 11-12% EBITDA 423 550 ~ 1,000 EBITDA % 11.6% 11.5% ~ 11-12% Capital Employed (w/o GW) 468 772 1,522 Cumulative FCF (FY22 - FY26) - - 2,000 ROCE (w/o GW) 74% 45% 50%+ *Goodwill = Rs. 628 Cr
Slide 35: Lifestyle Brands: India's Strongest Brand Portfolio
Lifestyle Brands India’s Strongest Brand Portfolio • Strong brand equity Versatile ever-growing brands • Evolving with consumer trends • Across segments, usage occasions • Scalable and asset light Industry leading distribution • Large headroom for growth • Consistently profitable with 50%+ ROCE Stro
Slide 36: Pioneering use of Cutting-Edge Technology: Season Model
Pioneering use of Cutting-Edge Technology 12 Season Model Product lead times reduced from 7 months to 45 days State-of-the-art technology for digital design creation and order booking New design creation every month Rapid response lines with mills Dedicated manufacturing for operational flexibility
Slide 37: Season Model: Advantages
Pioneering use of Cutting-Edge Technology 12 Season Model : Advantages • Quick response to consumer needs Product & Design • Agile product launches • “Many India” Merchandize • Efficient inventory management • Better sourcing deals Supply chain • Buys based on consumer feedback • Co-creation with ve
Slide 38: Phygital way of reaching consumers (BOSS)
Phygital way of reaching consumers “Buy Online Ship from Stores” (BOSS) Rapid Store Expansion • 800+ stores live Speed of Delivery • Order to dispatch < 6 hours Merchandise Management • Intelligent assortments; automatic replenishment Inventory Management • Greater assortment visibility to consumers
Slide 39: Summarizing a winning Model
Lifestyle Brands Summarizing a winning Model Strong and Versatile Brands Scalable and Profitable Asset-light model Strong Financial model with healthy growth, FCF and ROCE Leadership across multiple product categories Strong capabilities in channel management, retailing, product creation
Slide 40: Pantaloons
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Slide 41: Story of the most successful turnaround in the Indian Fashion Industry
Pantaloons Story of the most successful turnaround in the Indian Fashion Industry
Slide 42: Pantaloons: The turnaround strategy
Pantaloons The turnaround strategy Redefining the Pantaloons proposition and customer experience : 1. Revamped product strategy 2. Re-energized brand 3. Established growth model for profitability and scalability 4. Reset organizational capabilities to win in the future 5. Robust and rapidly improvin
Slide 43: Pantaloons: The turnaround strategy
Pantaloons The turnaround strategy Redefining the Pantaloons proposition and customer experience : 1. Revamped product strategy a. Improved Price-Value Equation b. Increasing private label share
Slide 44: Revamped product strategy: price-value equation
1. Revamped product strategy a) Improved price-value equation • Improved product design & aesthetics • Redefined fits for younger audience • Improved fashion quotient of products to appeal to a more fashion aspiring audience
Slide 45: Revamped product strategy: planning processes
1. Revamped product strategy a) Improved price-value equation • Redefined planning processes Increased freshness : New styles every fortnight Revamped supply chain through new allocation model and automated assortment planning Focused on • Improving Sell throughs • Delivering higher inventory
Slide 46: Actions to improve private label share
1. Revamped product strategy b) Strong actions to improve private label share • Sharply defined and rationalized private label architecture • New introductions : • Improve relevance for young audience: Launched PEOPLE, Candies • Strengthen Women’s Ethnic: Foray into Saris with a modern take, Premium
Slide 47: Labels for younger age group
1. Revamped product strategy Labels for younger age group
Slide 48: Foray into Saris
1. Revamped product strategy Foray into Saris 48
Slide 49: Living Scapes – Entry into the Home category
1. Revamped product strategy Living Scapes – Entry into the Home category
Slide 50: Pantaloons: The turnaround strategy
Pantaloons The turnaround strategy 1. Revamped product strategy a. Improved Price-Value Equation b. Increasing own brand share 2. Re-energized brand a. New positioning and imagery, with high salience b. Refreshed retail identity
Slide 51: Re-energized brand: new positioning and imagery
2. Re-energized brand a) New positioning and imagery, high salience • Revamped Imagery – Young, Contemporary & Vibrant • Stepped up marketing investments – 2X • Strong Digital marketing strategy to build salience and website traffic • Harnessed the power of 16 Mn strong loyalty program member base,
Slide 52: New Retail Identity launched
2. Re-energized brand a) New Retail Identity launched Vibrant, Modern & Interactive, based on international benchmarks
Slide 53: New Retail Identity – Vibrant, modern & interactive
2. Re-energized brand a) New Retail Identity – Vibrant, modern & interactive
Slide 54: New Retail Identity – Vibrant, Modern and Interactive
2. Re-energized brand a) New Retail Identity – Vibrant, Modern and Interactive
Slide 55: Pantaloons: The turnaround strategy
Pantaloons The turnaround strategy 1. Revamped product strategy a. Improved Price-Value Equation b. Increasing own brand share 2. Re-energized brand a. New positioning, imagery with high salience b. Refreshed retail identity 3. Established growth model – Scalability and unit profitability a. Strong
Slide 56: Proven store economics across store sizes and town classes
3. Established growth model a) Proven store economics across store sizes and town classes • Added 200+ stores over the last 4 years; present in 169 cities • Average store ROCE of 30% in COCO stores, consistent across town classes COCO Stores Metros Tier 1 & 2 Tier 3 & Below Total (8) (55) (55) Store
Slide 57: Robust network expansion plans
3. Established growth model b) Robust network expansion plans with a proven profitability model • Driving penetration in Tier 2/3/4 towns a significant opportunity • Plan to add 250 stores in the next 3 years across 100 new towns Current FY 25 City Tier Foot print Foot print Metro 8 8 Tier 1 31 44 T
Slide 58: Scale up of digital channels with great agility
3. Established growth model c) Scale up of digital channels with great agility • E-commerce channel scaled up 3x during FY 21; to contribute 8-10% of sales by FY25 • Stores migrating to become “Phygital stores” • 60 % network - Omni-enabled • Social commerce - a key channel going forward • Plans in
Slide 59: Pantaloons: The turnaround strategy
Pantaloons The turnaround strategy 1. Revamped product strategy a. Improved Price-Value Equation b. Increasing own brand share 2. Re-energized brand a. New positioning, imagery with high salience b. Refreshed retail identity 3. Established growth model – Scalability and unit profitability a. Strong
Slide 60: Redefined organisational capabilities
4. Redefined organisational capabilities Strong Digital transformation agenda across the value chain DIGITAL MARKETING DIGITAL PRODUCT LEADERSHIP • Drive traffic, improve conversions • Agile Merchandising • Personalization • Systematic Planning ANALYTICS AS ORG FABRIC PHYGITAL SHOPPING EXPEREINCE •
Slide 61: Pantaloons: The turnaround strategy
Pantaloons The turnaround strategy 1. Revamped product strategy a. Improved Price-Value Equation b. Increasing own brand share 2. Re-energized brand a. New positioning, imagery with high salience b. Refreshed retail identity 3. Established growth model – Scalability and unit profitability a. Strong
Slide 62: Robust and rapidly improving financial model
5. Robust and rapidly improving financial model Stellar financial turnaround; well positioned for accelerated growth (Rs. Cr.) FY17 FY20N FY26E Revenue 2,552 3,650 ~ 8,500 CAGR 13% 15-16% EBITDA 126 291 ~ 900 EBITDA% 4.9% 8.0% ~ 11% Capital Employed (w/o Goodwill) 512 600 1,622 CFCF (FY 22-26) - - ~
Slide 63: Pantaloons: Strong growth and financial model
Pantaloons Strong growth and financial model 1. Revamped product strategy with improved design aesthetics, better freshness and new labels for younger consumers 2. Re-energized brand with new positioning, higher marketing investments and a strong digital & data strategy 3. Established growth model f
Slide 64: New Business Segments
JAYPORE $ ? IA AMI GI AAC SHANTANU & NIRGIL New Business Se ts SS 4 TASWON A ETAL
Slide 65: New Business Segments: Setting up Future Growth Platforms
New Business Segments Setting up Future Growth Platforms • Building on our leadership position, forayed into potentially attractive segments: 1. Active athleisure innerwear 2. Youth western fashion for men/women 3. Super premium segment 4. Ethnic wear • Over the course of last 4 years we have been p
Slide 66: Innerwear & Athleisure: The Industry Disruptor
Innerwear & Athleisure The Industry Disruptor • Large unorganized and profitable market ‒ Driven by premiumization & growth of branded segment • Van Heusen (VH) has emerged as a clear number 2 player 1. Aspirational brand 2. Differentiated & innovative products 3. Deep distribution 4. Asset light sc
Slide 67: Innerwear & Athleisure: The Industry Disruptor
Innerwear & Athleisure The Industry Disruptor • Large unorganized and profitable market - Driven by premiumization & growth of branded segment • Van Heusen (VH) has emerged as a clear number 2 player 1. Aspirational brand 2. Differentiated & innovative products 3. Deep distribution 4. Asset light sc
Slide 68: Large (~$9 Bn) unorganized & profitable market
Market Opportunity Large (~$9 Bn) unorganized & profitable market Market projections1,2 (USD Bn) Strategic Intent Inner wear – Large market size ($9.3 Bn) with 12-13% expected future growth Men Women – Large part of market still unorganized 8.5 4.4 – Lifestyle changes to drive faster growth & 1.9 3.
Slide 69: Clear opportunities for market entry through Van Heusen
Market Opportunity We saw 5 clear opportunities for market entry through Van Heusen 1. Large unorganized market 2. Strong consumer pull towards aspirational brands 3. Profitable industry structure 4. Most players offering basic undifferentiated products - Opportunity for innovation 5. Strong right t
Slide 70: Innerwear & Athleisure: The Industry Disruptor
Innerwear & Athleisure The Industry Disruptor • Large unorganized and profitable market ‒ Driven by premiumization & growth of branded segment • Van Heusen (VH) has emerged as a clear number 2 player 1. Aspirational brand 2. Differentiated & innovative products 3. Deep distribution 4. Asset light sc
Slide 71: In a short span of time, we have emerged as a clear No. 2
In a short span of time, we have emerged as a clear No. 2 Trajectory: VH IW business trajectory Strong No. 2 player in short time span 280 12 Revenue (INR Cr) FY17 FY20N Business Launch Multi-brand outlets ~1,020 ~20,000 EBO - ~44 Department stores ~129 ~519
Slide 72: We have built our business on differentiated pillars
We have built our business on 5 differentiated pillars
Slide 73: Aspirational Brand
1. Aspirational Brand ATL campaigns Amplifying brand strength via 3600 campaigns & high impact launches Aspirational brand to upgrade customers
Slide 74: Aspirational Brand
1. Aspirational Brand BTL / activations Fashion shows Pop-up stores Amplifying brand strength via 3600 ‘Brafessor’ SIS campaigns & high impact launches Aspirational brand to upgrade customers
Slide 75: Aspirational Brand
1. Aspirational Brand Targeted digital marketing Amplifying brand strength via 3600 campaigns & high impact launches Aspirational brand to upgrade customers
Slide 76: Differentiated & Innovative Products
2. Differentiated & Innovative Products A B C Strategic Product laddering to drive Innovation to address unmet functional needs partnerships customer upgrade Products launched to address need gaps around “comfort” Strategic partnerships 3-layered product architecture and “fit” with best in class Men
Slide 77: Market winning products – Men
2. Differentiated & Innovative Products - Created a diverse range of market winning products – Men
Slide 78: Market winning products – Women
2. Differentiated & Innovative Products - Created a diverse range of market winning products – Women
Slide 79: Deep Distribution and Asset Light Scalable Model
3, 4. Deep Distribution and Asset Light Scalable Model A Trade B Retail C Dept Stores D E-Commerce Rapid expansion; 60% VH’s superior Strategic partnerships weighted coverage 3 Winning retail positioning in place already formats Asset light franchisee led model 50 stores to 500 stores over next 4 22
Slide 80: Category extension from IW to Athleisure & Activewear
5. Category extension from IW to Athleisure & Activewear Men’s Men’s Men’s Men’s Innerwear Men’s Athleisure Activewear Men’s Socks Thermals Loungewear FY21 FY17 Entered Women’s segment in FY19 – 1. Compete as a strong & credible alternative to the Vitals bra Sports bra market leader with a comprehen
Slide 81: Innerwear & Athleisure: The Industry Disruptor
Innerwear & Athleisure The Industry Disruptor • Large unorganized and profitable market ‒ Driven by premiumization & growth of branded segment • Van Heusen (VH) has emerged as a clear number 2 player 1. Aspirational brand 2. Differentiated & innovative products 3. Deep distribution 4. Asset light sc
Slide 82: We have a clear strategy built on strong pillars
Way forward We have a clear strategy built on strong pillars… 1 Aspirational brand 2 Differentiated & innovative products 3 Deep distribution 4 Asset light scalable model 5 Category extension from IW to Athleisure & Activewear
Slide 83: Strong position in the market
Way forward … which will allow us a strong position in the market Trajectory: VH IW total revenue (INR Cr) trajectory Aggressive growth plan going ahead 1500 280 12 FY17 FY20N FY26E Business Launch
Slide 84: Way forward: outstanding financial performance
Way forward …and help us deliver outstanding financial performance 1 2 (Rs. Cr.) FY17 FY20N FY26 Revenue 12 280 ~ 1,500 Reaching Highly Critical Scalable CAGR 32% Mass EBITDA -18 -48 ~ 225 3 EBITDA% -19% ~ 15% Low Capital Capital Employed 17 173 ~ 480 Expenditure CFCF (FY 22-26) - - ~ -100 4 5 ROCE
Slide 85: Youth Fashion Brands: Forever 21 – Turned around
Youth Fashion Brands Forever 21 – Turned around in last 3 years (Rs. Cr.) FY17 FY20N FY26 Revenue 201 160 ~ 500 CAGR 21% EBITDA -34 -1 ~ 40 EBITDA% ~ 8% Capital Employed (W/O) GW) 150 79 ~ 86 CFCF (FY 22-26) ~ 10 Cr ROCE NA NA 15%+ • Acquisition didn’t work out as per plan mainly due to challenges w
Slide 86: Youth Fashion Brands: American Eagle
Youth Fashion Brands American Eagle (Rs. Cr.) FY20N FY26 Revenue 43 200-250 CAGR NA ~ 34% EBITDA -17 ~ 20 A Powerful Brand. EBITDA% ~ 10% With a powerful Stance. Unique Capital Employed 42 ~ 80 Brand Positioning. CFCF (FY 22-26) ~ -10 Cr ROCE NA 15%+ • Strong Denim brand in the ABFRL portfolio • Amb
Slide 87: Super Premium and Luxury
Super Premium and Luxury Nurturing a profitable business (Rs. Cr.) FY17 FY20N FY26 Revenue 106 170 ~ 500 CAGR 17% 30% EBITDA -13 -6 40-50 EBITDA% 8 – 10% Capital Employed 36 60 ~ 150 CFCF (FY 22-26) < -10Cr ROCE NA NA 20%+ • Business nurtured over decade, strong consumer and business partner equity
Slide 88: Ethnic Wear - Vision
Ethnic Wear - Vision To be a leader in the Indian ethnic wear market, with presence across all key segments and serving the consumers through a portfolio of strong brands 88
Slide 89: The opportunity
The opportunity • Largest segment in the apparel industry Indian Apparel Market Ethnic Wear Market USD 65 Bn, CAGR 12 % USD 20 Bn • Women’s wear the largest segment • Organized segment USD 3.5-4.5 Bn, growing at 15 % and evolving • Very few scale players; no international 16 competition 45 20 2.6 1.
Slide 90: Ethnic market: Unique Structure with high share of luxury
Ethnic market : Unique Structure with high share of luxury Organized market Growth & profit $3.5-4.5 Bn Potential Market Brands Luxury 18- 20% ◕ Designer led ● 25 - 30% Bridge to Luxury 7-10% Designer Pret Collections Premium 30-33% ◑ Several established brands Value/ Mid-market 38-40% ◔ Store brand
Slide 91: A visible, marked shift towards ethnic wear
A visible, marked shift towards ethnic wear in last few years – poised for acceleration now • Ethnic wear – symbolic of who we are • Connecting with the roots – a significant trend amongst Millennials • Substantial increase in the number of ethnic relevant occasions • Weddings/Celebrations – big dem
Slide 92: Rationale for building ethnic play for ABFRL
Rationale for building ethnic play for ABFRL Sizeable, still evolving segment, with opportunity to build scale Our right-to-win: Solid foundation of category & consumer understanding built in Pantaloons (> Rs 750 Cr ethnic wear business) with deep knowledge of ethnic supply chain Lower competition:
Slide 93: Clear & distinct strategy to win in each segment
We laid down a clear & distinct strategy to win in each segment Share of organized ABFRL Strategy market % Route Luxury Invest in established, aspirational Inorganic, partnership 18- 20% ₹₹₹₹ designer brand Affordable Luxury 7-10% Launch pret lines of Designers Brand Extensions ₹₹₹ Premium Organic,
Slide 94: Portfolio completed through partnerships & organic plans
We have completed our portfolio through recent partnerships & proposed organic plans Organized market ABFRL Participation Strategy $3.5-4.5 Bn Existing New Luxury 18- 20% 7-10% Bridge to Luxury Launches in FY 21 • Premium Women’s Ethnic brand – Aug ’21 Premium 30-33% • Premium Men’s Ethnic brand wit
Slide 95: Our Play – Branded Ethnic
Our Play – Branded Ethnic Platform for Large, Long Term Value Creation Rs. Cr. FY20N FY26 Revenue 50 2,000 Growth (CAGR) 90% EBITDA -18 ~ 225 EBITDA% -39% ~ 11% Capital Employed (w/o GW) 61 ~ 800 CFCF (FY22 to FY26) -300 ROCE (w/o GW) NA 20%+ *Goodwill 334 Cr. • Build a strong ethnic portfolio of br
Slide 96: Summing up … key tenets of ABFRL strategy
Summing up … the key tenets of ABFRL strategy • Grow the Core • Lifestyle Brands and Pantaloons have a well tuned operating model. • Poised for accelerated growth (FY 22-26) • Enrich the portfolio • Build meaningful presence in innerwear, casual wear and super premium • Rapid scaling of these format
Slide 97: Financial Performance
4. Financial Performance Financials and COVID-19 Strategy disclosed in Q4FY20 presentation of the Company dated May 27, 2020, uploaded on Company website: (http://www.abfrl.com/docs/investors/financial_reports/performance_update/ABFRL_Performance_update_May_27_2020.pdf) and the Stock Exchanges: www.
Slide 98: ABFRL | P&L Trajectory
ABFRL | P&L Trajectory Well placed portfolio in a large growing apparel market....... Revenue FY17 CAGR FY20N CAGR FY26 (INR crs) (FY17 - 20) (FY20 - 26) Lifestyle Brands 3,651 10% 4,800 11% - 12% ~ 9,000 Pantaloons 2,552 13% 3,650 15%-16% ~ 8,500 New Businesses 464 23% 870 32% ~ 4,500 ABFRL* 6,633
Slide 99: New Business: Aggressive build up of new growth engines
New Business Aggressive build up of new growth engines Revenue FY20N CAGR FY26 (INR crs) Inner Wear 280 32% 1,500 Global Brands + Youth Fashion 373 24% 1,200 Ethnic Businesses 50 85% 2,000 New Business 703 ~ 4500 EBITDA FY20N FY26 (INR crs) Inner Wear -48 225 Global Brands + Youth Fashion -60 100 Et
Slide 100: ABFRL | Balance Sheet trajectory
ABFRL | Balance Sheet trajectory ..with clear focus on balancing Growth, Capital Employed and ROCE Capital Employed FY20N FY26 (INR crs) With GW W/o GW With GW W/o GW Lifestyle Brands 1,400 772 2,150 1,522 Pantaloons 1,768 600 2,800 1,632 New Business 624 436 2,100 1,702 ABFRL 3,792 1,900 7,050 4,85
Slide 101: Consistently improving financial performance
Consistently improving financial performance... FY17 FY20N FY26 Revenue 6,633 9,100 ~ 21,000 Growth (CAGR) 12% 15% EBITDA 476 693 ~ 2,350 EBITDA% 7.2% 7.6% 11.2% ROCE (w/o goodwill) 7% 12% 35%+ Continuous focus on profitable growth, as reflected in improved EBITDA and Margins 101
Slide 102: …that will result in significant value creation
…… that will result in significant value creation Strong Growth Trajectory – CAGR of ~ 15% from FY20 to FY26 Sharp improvement in Profitability - EBITDA margin expansion of ~ 360 bps Robust Cash Flows from FY22 to FY26 Cumulative operating cash flows of ~ Rs. 2,000 Cr. • Rs. 4,000 – 4,500 Cr o
Slide 103: Thank You
Thank You For further queries, please contact our investor relations team Rahul Desai Rahul.desai@Abfrl.adityabirla.com +91 9820092234 Amit Dwivedi Amit.dwivedi@Abfrl.adityabirla.com +91 9818824937
Slide 104: Disclaimer
Disclaimer Certain statements made in this presentation may not be based on historical information or facts and may be “forward looking statements” including, but not limited to, those relating to general business plans & strategy of Aditya Birla Fashion and Retail Limited (“ABFRL"), its future outl
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