Raymond Ltd will leverage on the cash generation of the textiles business (Rs2.5bn CFO in FY16) to grow the brands business. The brands business’ footprint will be driven by exclusive brand outlets (B2C) as against the traditional wholesale channel (for fabrics).
Consumers are rapidly shifting to ready-to-wear, especially men below the age of 45 years. This trend is visible and similar across major cities as well as small towns. With this trend expected to intensify, apparel will be the key growth driver for Raymond.
Complete wardrobe solutions through brand extensions with clear brand positioning across its four brands is the path to sustainable and profitable growth. Therefore, scale should be measured by product range rather than store reach.
Raymond will be making stores more experiential by offering differentiated shopping experience and digitizing them, while also making them distribution centres. Top 10 cities constitute nearly half of the organized market; making most of the opportunity, beyond these cities, hinges on product range driven scale, value proposition with great in-store experience, and working capital management.