Rupa & Company Ltd eyes 18% growth in sales in FY22

Knitwear maker Rupa & Company Ltd is expecting around 18 per cent growth in sales in FY22 backed by premiumisation of portfolio and foray into newer markets, besides strengthening presence in existing markets. The company had registered around 35 per cent growth in standalone turnover in FY21 at ₹1,261 crore, albeit on a lower base as sales were disrupted in March last year due to the Covid-19 induced lockdown.

According to Ramesh Agarwal, ED & CFO, Rupa, March is a very “heavy” month for knitwear as a majority of sales happen during the month. However, the nationwide lockdown in March 2020 impacted sales. Barring last fiscal, the company has been registering an annual turnover of ₹1,100-1,200 crore over the last few years on a standalone basis.

“We are expecting 17-18 per cent growth in sales this fiscal on the higher base of last year. This is on the back of a huge demand for athleisure and casual wear ahead of the festive season. We are also witnessing a high demand for thermal wear with winters round the corner,” Agarwal told BusinessLine .

The company, which registered less than one per cent growth in standalone turnover at ₹207 crore in the first quarter of this fiscal, is hopeful of 20-22 per cent sales growth in Q2 FY22.

“In the first wave, after the lockdown, was lifted we saw a very good demand. But in the second wave, the demand has been low as the rural markets were affected. But we have been witnessing an improvement since June onwards and we are hopeful of 20-22 per cent growth in Q2 this year,” he said.

Premiumisation of offerings

Rupa, which has a diversified product basket comprising of innerwear, thermal wear, casual and athleisure, has a bouquet of brands across all price segments including economy, mid-premium, premium as well as the super-premium categories.

Plans are afoot to ramp up its offerings across mid premium and premium segments by launching more products. Premium and super premium currently account for nearly 30 per cent of the total turnover at present.

“Going ahead, the company’s focus is to improve its product mix, increase share in premium and super premium category, increase focus on women wear, casual, and thermal wear,” it said in the investor press release.

Geographical expansion

Rupa, which has a sizeable presence in east, north and west India, is looking to strengthen its presence in existing markets and foray into newer markets. Plans are afoot to strengthen its footprint in central and south India moving forward.

“In south, we are currently present in Karnataka and Telangana, we are looking to strengthen our presence further in these markets and also look at other markets including Kerala and Tamil Nadu. This apart, we are also looking at strengthening our footprint in Madhya Pradesh and Chattisgarh,” he said.

The company has close to 1,300 dealers and distributors across the country and it plans to add 100-odd distributors during the current year primarily in central and south India. Rupa’s products are available across 1,25,000 outlets at present.

On the exports front, it currently exports to markets in UAE, Saudi Arabia, Kuwait and Iraq and it has also added newer markets like Myanmar, Ukraine, Algeria, Indonesia, Nigeria, Congo and Singapore among others. According to information available in investor presentation, the company’s exports stood at close to ₹25 crore in FY20. It plans to double its exports by FY22 by expanding in new international geographies.