ABFRL
ABFRL gears up to acquire 10 digitally-native brands in next 12 months to grab a slice of D2C market, says MD: Report
Fashion retail major Aditya Birla Fashion and Retail (ABFRL) is looking to acquire 10 digitally native or direct-to-consumer (D2C) brands over the course of the next 12-14 months and simultaneously launch five-six such brands in-house as it tries to grab a share of the rapidly-growing D2C segment, Moneycontrol reported.
The company’s Managing Director Ashish Dikshit told Money Control that ABFRL is setting its sights on the digital channel as it doesn't want to miss out on consumers of the future.
"In the long term, about three-four years, the ABFRL subsidiary that will be created to invest into early-stage brands, will house about 25-30 digital-first brands," Dikshit told Moneycontrol.
The company wants 10 - 15 percent of its revenue coming from D2C in the next five years.
“We have approval from the board to start a subsidiary and invest in a bunch of promising early-stage brands and help them grow using our capability; whether it's in supply chain sourcing or access to the marketplace are capital of finance,” Dikshit was quoted as saying.
ABFRL wants to initially direct its funds in the acquisition and launch of digital-first brands. It plans to raise funds if the need arises in the course of the company's growth.
Dikshit said the company will acquire brands only in adjacent spaces.
“We will be acquiring brands and developing brands which can be sold on multiple platforms such as their websites, apps, marketplaces and other channels. We are investing in these brands to help them accelerate their growth on multiple platforms that they may or may not be selling,” he added.
ABFRL owns leading brands in the men’s apparel segment such as Louis Philippe, Van Heusen, Allen Solly, and Peter England.
In January, it acquired a 51 percent stake in designer Masaba Gupta's brand House of Masaba Lifestyle for Rs 90 crore.
In December, ABFRL had signed a long-term licensing agreement with US-based brand management company Authentic Brands Group (ABG) to distribute and sell Reebok products in India and other ASEAN (Southeast Asian) countries, the report said.
“If you see our strategy for the last five years, we have identified large consumer segments and are trying to create a play in them,” Dikshit was quoted as saying.
The company is also building its ethnic wear portfolio and acquiring key designer labels.
In January, it acquired a 51 percent stake in Kolkata-based designer Sabyasachi Mukherjee's bridal couture brand Sabyasachi.
In February, the company joined hands with designer Tarun Tahiliani, taking a 33 percent holding in his men’s ethnic wear label house.
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