Mukesh Ambani’s Reliance Industries Ltd-controlled international and Indian lifestyle brands had a tough financial year ended March, with a majority of its businesses reporting a weak performance, according to the company’s annual report released on Wednesday.
Some companies, led by Reliance Brands Ltd (RBL) that owns more than 50 international fashion labels, faced challenges. Despite an increase in total revenue by 13% to ₹2,303 crore in FY24, RBL’s losses widened by 55% to ₹288.4 crore from last year's ₹185.16 crore. The increase in sales did not translate into profitability for brands like Diesel Fashion India and Paul & Shark which RBL controls.
RBL began operations in 2007 and has a portfolio of brand partnerships comprising Dune, Hamleys, Pottery Barn, Tory Burch and West Elm.
Across the spectrum, Reliance has a controlling stake in about 50 international brands which are either in the luxury domain or the affordable or entry segment. It also works with over half a dozen designers like Rahul Mishra, Manish Malhotra, Anamika Khanna, Abraham & Thakore, Abu Jani and Sandeep Khosla as well as Ritu Kumar, among others.
After a very strong FY22, when India came out of the pandemic and shoppers stampeded out to buy fashion and luxury articles, a consumption slowdown in 2023 meant reduced discretionary spending. In fact, most of Reliance’s designer brands reported losses in the year gone by. While designer duo Abu Jani and Sandeep Khosla showed profitability, other designer brands under its portfolio struggled, reflecting a challenging environment in the luxury fashion sector.
Reliance A&T Fashions Pvt. Ltd, operating the brand for designer duo Abraham & Thakore, saw some decline in revenue to ₹5.99 crore and a net loss of ₹8 crore in FY24. It had recorded a loss of ₹3.75 crore in FY23. It did not report any revenue last year when it was acquired by Reliance.
Similarly, Purple Panda Fashions Ltd, which sells lingerie under the Clovia brand, reported a revenue of ₹262.93 crore, lower than ₹295.51 crore in FY23. However, losses narrowed to ₹28.53 crore from ₹80.93 crore in FY23.
Genesis Colors Ltd, which sells brands like Paul Smith and Bottega Veneta, also struggled, with its revenue dropping to ₹38.99 crore from ₹44.36 crore and loss rising to ₹19.89 crore from ₹16.03 crore.
It’s no secret that online shopping has gained in popularity, while footfalls at physical stores have been dwindling, which could be one of the reasons for sales slowing down.
Reliance AK-OK Fashions Ltd, selling designer Anamika Khanna’s brand, saw its revenue jump to ₹16.63 crore from ₹0.15 crore, and a narrower loss of ₹1.27 crore, down from ₹3.49 crore.
RBL had in 2021 announced a 60:40 partnership with the couturier.
Genesis La Mode Pvt. Ltd, which sells popular bridge-to-luxury brand Coach and luxury brand Salvatore Ferragamo, saw its sales rise 17% to ₹368.69 crore, and profit increase by about 15% to ₹25.4 crore. GLF Lifestyle Brands Private Ltd, which sells Hugo Boss and Emporio Armani, reported a flat revenue at ₹148.51 crore, but swung to a loss of ₹0.92 crore, from a profit of ₹9.23 crore in FY23.
Reliance Brands Luxury Fashion Pvt. Ltd, which operates brands like Canali and Bally, reported a revenue of ₹322.53 crore in FY24, slightly higher than ₹312.68 crore in FY23. Its profit fell to ₹16.6 crore from ₹21.7 crore.
Reliance GAS Lifestyle India Pvt. Ltd, which sells the popular brand Gas Jeans, saw a 14% increase in revenue at ₹108.62 crore in FY24, but reported a loss of ₹1.5 crore, swinging back from a profit of ₹5.63 crore in FY23.
Reliance Ritu Kumar Pvt. Ltd—which sells the eponymous fashion label—reported an 11% drop in revenue to ₹289.59 crore, with a net loss of ₹11.5 crore in FY24 from a net profit of ₹4.63 crore in FY23. In 2021, Reliance Retail Ventures Ltd (RRVL) acquired a majority stake in the fashion designer’s Ritika Pvt. Ltd.
Reliance Rahul Mishra Fashion Pvt. Ltd, with which Reliance Brands Limited has a 60:40 joint venture partnership, saw its revenue surge to ₹29.06 crore in FY24 from ₹1.4 crore the previous year. It reported a net loss of ₹6.91 crore, doubling from FY23.
