Several corporations of their Q1FY24 earnings assertion have mentioned that the demand setting stays difficult and companies are pinning their hopes on the festive season for a revival in spending. “When do we expect the demand to recover, I think definitely not before the festival period,” mentioned Ashish Dikshit, MD at Aditya Birla Fashion and Retail, whereas indicating {that a} late onset of festivals and shift of marriage ceremony dates to later a part of the yr will delay the method of demand restoration. “… this time as you know, the festivals have also got pushed later into the year. They are about 20-30 days later than the same period in previous year… a lot of weddings have also gotten shifted to the second half of the year… that is an important piece for our premium brands as well as for the larger ethnic portfolio,” Dikshit mentioned. Even the value-conscious clients in smaller cities restricted their purchases, weighing on the efficiency of the agency’s fashion model Pantaloons.
For Shoppers Stop, attire gross sales proceed to be sluggish. “The retail market, particularly apparel, has been moderating since Diwali last year… our private brand sales largely remained flat (in Q1) due to tough market conditions,” MD & CEO Venu Nair mentioned.
Referring to the industry-wide muted efficiency of the fashion phase, Nykaa’s government chairperson, MD & CEO Falguni Nayar described the April-June quarter as an ‘odd’ one the place corporations couldn’t do something to pique the curiosity of shoppers. “It almost felt like the customers were missing,” Nayar mentioned.
Things are usually not wanting up for the footwear phase as effectively. “On the discretionary spending front, demand remains subdued in the footwear sector, prolonging the deceleration that started towards the end of March 2023,” a Bata India government mentioned.
High inflation throughout industries and classes has led to a short-term affect on shopper sentiment and demand in the previous couple of quarters, mentioned Ravi Jaipuria, non-executive chairman at Devyani International, which operates manufacturers like KFC, Pizza Hut and Costa Coffee. The agency indicated that buyers took to downgrading amid an inflationary setting, prompting corporations to introduce worth choices. “… We are trying to build a value layer for KFC so that we can focus on the number of transactions and we are able to get more footfall in our stores,” firm officers mentioned.
For the Pizza phase, too, inflation does not bode effectively. “Whenever there is high inflation, the pizza category gets impacted… there are cheaper QSR entry options ,” mentioned CFO and director Manish Dawar. They anticipate demand to decide up solely from the third quarter.
