20 October 2023, Mumbai
Hennes & Mauritz (H&M), the Swedish fashion retailer, reported a 40% increase in sales in the year ending March 2023, retaining its status as India's leading fast fashion brand in terms of revenue due to competitive pricing.
Nevertheless, this growth was a drop from the 49% increase recorded the previous year, signifying a shift in consumer preferences toward brands like Uniqlo and Zara.
Outlines
In the fiscal year 2022-23, H&M's sales amounted to Rs 2960 crore, a significant jump from Rs 2115 crore in the preceding year. Their net profit also surged, increasing by 72% to reach Rs 43.6 crore.
H&M's online sales exceeded the Rs 1000 crore milestone, constituting 40% of their total sales, with ecommerce revenues totaling Rs 1178 crore.
The company inaugurated a new logistics center for online sales in New Delhi.
H&M specializes in fast fashion produced in-house and collaborates with designers for exclusive collections.
They maintain a substantial inventory of affordable everyday items sourced from countries like India and Bangladesh.
Nuances
Inditex Trent, H&M's joint venture with Tata, which operates 20 Zara stores in India, recorded a 40% revenue growth, surpassing H&M in profitability.
In the organized retail sector, sales rose by 34% during FY22-23 compared to the pre-pandemic era, driven mainly by quick-service restaurants, sporting goods, and electronics, according to the Retailers Association of India.
Sweet spot
India, being the world's second most populous country, remains an attractive market for apparel brands, with an increasing acceptance of western-style clothing among the youth.
Companies like Levi's, Uniqlo, and Celio are gaining popularity for their functional basics, unlike fast-fashion competitors known for rapidly changing designs.
Levi Strauss & Co recently named India as its largest market in Asia and the sixth largest globally.
