Just a day before Durga Puja, which marks the beginning of the festival season in the country, many apparel retailers are worried about sales.
Though they report higher Puja sales compared with last year, the general consensus across the country is that festival buying is yet to pick up.
“The festival season sales that opened with the eastern region (Durga Puja) have seen good offtake. However, they are not up to our expectations. Hopefully, markets will improve around Diwali,” Sumeet Soni, COO, Raymond Premium Apparel, said. Raymond Premium Apparels is one of the branded apparel arms of the Raymond group.
Raymond Ltd’s results for the quarter ending September 30, 2012, mentioned that its branded apparels (that include Park Avenue, Parx, Color Plus, and Raymond Premium Apparels) reported a decline in margins. EBIDTA stood at Rs 22 crore during the period compared with Rs 41 crore during the corresponding quarter last year.
Margins were impacted “because of subdued consumer sentiments and a conscious effort to liquidate stocks during the extended end-of-season sale”.
Eastern parts
Kolkata-based menswear retailer Turtle, too, despite a good growth from the eastern parts (nearly 15 per cent over last year), points out to subdued Diwali demand so far.
“Diwali sales are yet to pick up. We hope things will improve substantially by early November,” Sitanshu Jhunjhunwala, Director, Turtle Ltd, said. The company expects a monthly business of around Rs 16 crore during the festival season — nearly double the summer season sales of Rs 8 crore a month.
According to Jhunjhunwala, purchases have been delayed with most offtake happening in the extended end-of-season sale period,” he adds.
Spurt in Sales
According to Atul Chand, Chief Executive, Lifestyle Retailing Business Division, ITC Ltd, there has been a spurt in sales this festival season.
“Sales grew 15-20 per cent on a week-on-week basis. If you compare it with the festival season (for instance, Durga Puja in Kolkata), then there has been a 20 per cent growth over the last season,” he said.
This is in contrast to the weak summer sales when the footfalls had also fallen to a great extent.
Inflation
Arvind Retail too has been reporting good sales. The company is eyeing 25 per cent growth in sales this festival season. “Overall sales have been slow because of high inflation but they are slowly picking up,” P. S. Rajiv, Head-Retail, Arvind Ltd said.
According to Siddhartha Bindra, Managing Director of the women’s ethnic wear brand Biba, there has been a 40 per cent growth in sales during the last two weeks compared with the festival season last year.
“A lot of our festival collections and party wear apparels have had good demand. We hope to achieve 115 per cent of our sales target in the eastern markets,” he said. The eastern region accounts for about 15 per cent of the company’s total sales.