India’s Arvind Lifestyle Brands Limited (ALBL), a wholly owned subsidiary of Arvind Fashions Ltd (AFL), has seen its brands recover to pre-pandemic levels. The Indian denim manufacturer and fashion brands management company has also just raised 59 million dollars from existing investors.
The Asian fashion group announced Monday it has raised 439 crore rupees (a little over 59 million dollars) from existing investors. The new funding will “significantly strengthen” the balance sheet and allow the business to pursue its growth strategy while simultaneously protecting from near-term pandemic-related uncertainties, AFL said in a statement.
It’s worth recalling that earlier this summer, the Indian retailer signed a definitive agreement to sell its value-fashion retail chain Unlimited to retailer V-Mart Retail Ltd, for about 20.2 million euro in an all-cash transaction. Commenting on the deal, the CEO of Arvind Fashions, Shailesh Chaturvedi, said they got a “fair deal” for Unlimited and plan to focus on growing “high conviction brands” such as US Polo Assn., Tommy Hilfiger, Calvin Klein, Arrow, Flying Machine and Sephora.
Arvind Fashions to focus on the six brands that have already recovered from pandemic’s impact
Arvind Fashions “We believe, for our strategy of profitable growth, those six brands are the focus areas. In that context other things become less important.”
Indeed, these brands would have recovered sales levels not seen since the pandemic started, according to Chaturvedi. “We thought through very hard, and we figured our core competency is a very enviable portfolio of six brands. Most of our brands have a relaxed, casual feel so they’re perfect for post-covid, work-from-home, relaxed wear scenario. In July and August our brands are recovering very strongly because our portfolio is ideal for work from home,” he added.
In a recent interview, the company’s CEO acknowledged that “Covid wave two was very strong and very bad” and that the lockdowns and store closures impacted the business negatively. “But one thing that helped was that we had a playbook. We had done things last year, so we had some sort of muscle memory built on how to manage costs and cash flows. We had a Rights Issue money coming in in May that also helped,” highlighted Chaturvedi.
The company delivered 50 percent net sales value in the first quarter of this year, compared to the same period a year and two years ago. ”But compared to last year, our business became four times in the first quarter. A large amount of that growth came from our power brands, and also from digital,” pointed out the company’s executive.