22 July 2023, Mumbai
Libas, the popular digital-first ethnic fast fashion brand, has ambitious expansion plans. In the current fiscal year, the company aims to open 25-30 Exclusive Brand Outlets (EBOs) and extend its presence across 650 Multi-Brand Outlets (MBOs), including Lifestyle, Shoppers Stop, and Central.
Brand gone places
With 12 EBOs and 400 MBOs already under its belt, Libas is eyeing both malls and high streets for its new stores. Initially targeting metro cities like Delhi, Bangalore, Mumbai, and Chennai, the brand plans to move into Tier II cities afterward.
The expansion will follow a region-wise approach, starting from the north and progressing to the south, east, and west. Libas' average store size will range from 1,200 to 1,800 sq.ft., and the estimated CAPEX for each store will be Rs 1.3 crore.
Funds raise
All EBOs will operate under a company-owned company-operated (COCO) model. To support its offline expansion, Libas is seeking its first round of funding amounting to Rs 150-200 crore over the next two years.
The brand's target audience spans from 18 to 35 years, with its revenue distribution coming from north India (36%), south India (30%), west India (20%), and east India (14%).
Digital-first brand
Libas generates 70% of its revenue from marketplaces and divides the remaining 30% equally between offline and Direct-to-Consumer (D2C) sales. The brand has witnessed a shift in revenue growth, with 48% now coming from Tier II and Tier III cities post-COVID, compared to 52% from metro and Tier I cities previously.
Growth trajectory
Presently, Libas offers 4,000 SKUs and launches 70-75 new options per week. The brand's future target is to introduce over 100 new options weekly, translating to 400-500 options per month.
While Libas has expanded internationally through online channels in countries like the US, UK, Australia, and UAE, it currently has no plans to expand its offline presence beyond India.
Aspirational
The brand is optimistic about its financial performance, aiming for an EBITDA of 12-14% this fiscal year compared to the 8% achieved in the previous one.
The brand's Gross Merchandise Value (GMV) for the last fiscal stood at Rs 750 crore, and for the current fiscal, Libas aims to reach Rs 1,100 crore. Additionally, the brand looks to achieve a net revenue of Rs 700 crore in FY 2024 and cross the Rs 1,000 crore revenue mark by FY 2025, as it continues to grow its presence in the fast fashion market.
