In 2012, Assocham (Associated Chambers of Commerce and Industry of India) released a report which pegged the Indian designer wear industry at Rs 720 crores (c. USD 133 mn). Now that may seem like an unusually small figure but when you take into account expert predictions that the number is is likely to cross Rs 11,000 crores (c. USD 2 bn) in the next six years, one stops and takes notice.
That the Indian film industry no more treats the magic number of Rs 100 crores as a benchmark is a story of the past. Aspirations lead them towards the 200 crore mark, and it doesn’t seem like much of a task. But the real tale is that the fashion industry isn’t too far behind either. Indian fashion has its own Rs 100-crore club, and it is one that is filled with talent and experience.
Who are the designers who are taking the Indian fashion growth story ahead and what are the reasons for this humungous 40% CARG (compounded annual growth rate)? Buckle yourselves in as we take you for a close-look ride to meet the members of this aspiration-worthy denominational-high club.
For the most part, you can attribute this heady growth of the fashion industry to an increasing awareness among urban Indians. There is a sense of wanting to wear the best brands and being on the same stage, sartorially, as the upper echelons of society. Then, there is the matter of higher disposable incomes, an indefatigable mall culture, and of course a consciousness of what is happening beyond their own style backyard. With this tendency on the rise, Indian designers are making huge strides commercialising and cashing in on the opportunity presented to them, and how.
Big demand translates to big sales, and sales are booming. The Ritu Kumar brand, a revivalist and trousseau concentrated fashion house which has made huge strides in the industry for over 4 decades now, recently announced a minority-stake sale worth Rs 100 crore (USD 18.5 million) to Everstone. Anita Dongre, with her bridal label and her retail labels – AND and Global Desi – announced profits of Rs 100 crore last year. This year her turnover is expected to touch Rs 350 crore (USD 64.8 million).
While one may think that the sales growth is because of the large investments, this is not necessarily the case. There are designer labels who are self-owned and self-promoted and have required no outside help to reach the 100 crore figure. Take designer Sabyasachi for instance. With a Rs 100 crore turnover this year, his sales growth has been commendable considering that his success has been devoid of any external investor help or mass-market products.
Then there is Manish Malhotra, whose Rs 108 crore turnover (USD 20 million) is aided by the Bollywood glamour he promotes and the several collections he releases each year. Tarun Tahiliani and Satya Paul are some of the other names that have inched towards the Rs 100 crore mark via their retail and other ventures.
Of course the road ahead seems smoother with more angel investors buying stakes in designer labels, and retail labels bringing in more profits for high-end designers. Or may be an era when the design gurus will sell stakes of their labels and control only creative rights. Maybe then we will see a glorious triumvirate of gorgeous fashion, incredible prices, and lofty profits.
Sources: Indian Designer wear industry growing at CAGR of 40%. Retail Angle (online), 4th Feb 2012, Everstone invests Rs 100 crore in Ritu Kumar. Live Mint (online), 1st April 2014, Anita Dongre, the designer who broke societal stereotypes to be an entrepreneur. Your Story (online), 3rd Mar 2014, Sabya Score: 100 crore! The Telegraph (online) 12th March 2014, Old World Charm. Business Standard (online) 12th July 2014, Genesis Colors: Success Beyond Satya Paul. Forbes India (online) 2nd Sep 2013