Aditya Bir. Fas. Director Discussions


Dear Members,

Your Companys directors hereby present the Sixteenth Annual Report together with the audited financial statements of the Company for the financial year ended March 31, 2023 ("year under review/ FY 2022-23").




During this year, industries experienced resurgence, with many sectors either returning to or surpassing pre-COVID levels. However, this revival has not been devoid of challenges, as geopolitical situations and inflationary pressures created several uncertainties, especially in global markets. In the global context, India continues to be a relative out-performer supported by domestic drivers such as strong consumption demand, robust corporate balance sheets, Governments focus on infrastructure and its appeal as an attractive destination for foreign inflows.

Global Economy Overview

The year 2022 witnessed a mix of positives and negatives, while there was economic recovery led by pent-up demand, there were also challenges caused by geopolitical tensions and a resurgence of COVID in China. These uncertainties gave rise to various issues, including inflationary pressures and decline in consumer and investor confidence. The global economy is anticipated to experience a slowdown in the current calendar year due to factors such as rising interest rates, slowdown in consumption etc. Per International Monetary Fund (IMF), global growth is expected to be 2.8% in 2023.

Although, with inflation beginning to ease, there is a growing sense of optimism, particularly in emerging economies. These economies are expected to continue being a major driving force for global growth, contributing a significant portion to overall GDP growth in the upcoming decade. For 2023, GDP growth for emerging markets and developing economies is expected to be 3.9% against 1.3% for advanced economies.

Indian Economy Overview

Indian economy has shown promising growth, with RBI estimating GDP growth rate of around 7% for the fiscal year 2022-23.

Indias economic growth in FY23 has been principally led by increase in private consumption and capital formation. The nationwide vaccination drive had a significant impact on the publics outlook, resulting in rise in consumer spending and also return to restaurants, hotels, malls, and cinemas. This, in turn, improved corporate balance sheets, which had a positive effect on the banking system, as it overcame the challenges related to asset quality. Additionally, the robust collection of goods and services tax (GST) and direct taxes also resulted in increased Government spending.

This path to sustained recovery continued to face several challenges, including rising inflation, supply chain constraints, aggressive tightening of monetary policy across the central banks of advanced economies. However, India has demonstrated resilience by successfully navigating through these challenges without a significant loss of growth momentum.

Indian Economic Outlook: Long Term Optimism

As we step into the fiscal year 2023-24, India is expected to experience reasonably strong growth driven by multiple growth catalysts, leading to a GDP growth rate of 6.5% as forecasted by RBI. Indias prospects for FY24 are marked by improving capacity utilization, Governments emphasis on capital spending, sustained buoyancy in services and strong domestic demand.

Consumer demand particularly amongst the affluent class in metros and tier I cities shall continue to remain strong. In addition to robust urban trends, the improvement in aspirations of rural and tier M/III cities shall contribute positively to the overall aggregate demand.

Despite unfavourable global factors that have dampened the near-term growth momentum, the countrys resilient domestic growth drivers are anticipated to sustain and propel long-term economic growth.

India recently emerged as the fifth-largest economy in the world, and will continue to be seen as one of the key contributors to world economy. The country is an emerging manufacturing hub within global value chains, an expanding consumer market, and a frontrunner in driving digital transformation across both public and private sectors. The Government has been consistently taking proactive steps to support businesses, whether its through promoting trade liberalization, refining tax rates, or maintaining an open approach towards foreign investments. At the back of these strong measures, the Indian economy continues to outshine and make a compelling case of investment for global investors.

Industry Review

Global Apparel Industry

After experiencing a huge setback during and after pandemic, the worldwide fashion industry made a strong recovery in 2021 and continued to grow at the start of 2022. However, the industrys momentum slowed down in the second half of 2022 due to deceleration in spending, macroeconomic volatility, rising inflation, and weak consumer confidence.

In 2023, the apparel industrys sales are expected to grow at a reasonable pace as the demand recovers in second half of the year. Per Euromonitor, the worldwide Apparel Market size is expected to grow from USD 1.37 trillion in CY 2022 to USD 1.48 trillion in CY 2023 at an annual growth rate of 8%. This Market is expected to grow to USD 1.8 trillion in 2027 at a CAGR of 6%.

The Luxury category is expected to grow at a faster pace owing to its superior resilience to inflation, compared to other categories. Casualwear and Sportswear segment are projected to continue expanding, while Occasion wear is expected to gain momentum due to re-emergence of events such as weddings and festive celebrations on a grand scale following the pandemic. There is also an increasing demand for sustainable and eco-friendly clothing, as consumers become more environmentally conscious.

With the direct-to-consumer (DTC) model gaining prominence, consumers are looking for more personalized and convenient shopping experiences. Brands continue to move beyond traditional retail channels and sell their products directly to consumers through their online and offline channels.

The Indian Apparel Industry

As India undergoes rapid economic growth, number of individuals with higher disposable income will be on a rise, fueling increasing spend on non essential goods and services. The rapid urbanization of the country has also played a significant role, as urban centres foster access to an array of lifestyle choices. Moreover, the demographic landscape, has resulted in an expanding working-age group and an increase in dual-income households, further boosting the demand for discretionary products. As Indias per capita income is experiencing rapid growth, among various categories, fashion apparel is anticipated to exhibit the highest growth rate and maintain its position as one of the largest segments. With increasing affluence, consumers are likely to enhance their fashion preferences and keep up with evolving trends, driving sustained demand for apparel products in the market.

The Indian Apparel Market expanded to approximately INR 5.5 trillion in FY23. The market exhibited an uneven recovery, with urban markets demonstrating a more robust bounce-back and surpassing pre-COVID levels in FY23. While on the other hand, rural, tier III and IV markets have faced inflationary headwinds and hence remain in recovery phase.

In this post-pandemic world, many fashion and apparel retailers have continued to expand their retail footprint. The year 2022 highlighted that e-commerce and omnichannel play became a permanent feature in the retail industry. Several brands have increasingly adopted omnichannel play, leveraging their physical stores to fulfil online orders and enhancing customer value proposition.

Outlook: Positioned for a significant growth

Indias apparel market has been experiencing steady growth, supported by several factors such as rising fashion consciousness, increasing young working population, and the emergence of branded players. This growth trend, positions India as a key player in the global fashion industry, especially when coupled with the countrys growing economy and increasing digital consumption. As a result, India is poised to become a major fashion hotspot in the future with Indian apparel market expected to reach approximately INR 7.5 trillion by FY25.

Indias young population sets it apart from other major economies, and this demographic advantage is anticipated to drive the expansion of organized retail. With a median age of approximately 28.2 years, the younger consumer exhibits a greater propensity for discretionary spending and possesses the ability to quickly embrace and interpret fashion trends. Consequently, the anticipated contribution of "Gen Z and Millennials" is expected to substantially bolster the growth prospects of the apparel sector.

Technology continues to play an increasingly important role in the Indian fashion industry, helping designers, manufacturers, and retailers to improve their processes, increase efficiency, and provide

better customer experiences. E-commerce platforms have transformed the Indian fashion industry, making it easier for customers to shop online for apparel and accessories. Many Indian fashion brands have launched their E-commerce portals to sell products directly to customers. To remain competitive in a digitally driven retail landscape, fashion brands are investing in enhancing their retail technology prowess.

In this highly competitive apparel retail industry, the ever-changing consumer preferences offer a great opportunity to companies and brands to evolve, which in turn, is essential for brand success and market leadership. In the current landscape, brands that are "agile to align" with rapidly changing preferences are more likely to thrive and gain a competitive edge.

Key Trends in the Indian Apparel Industry

1. Continued Premiumization

Premiumization is significantly impacting the Indian fashion industry by driving the demand for premium and luxury brands, designer fashion, and personalized experiences. It has led to the emergence of appealing retail spaces, an increased focus on quality and craftsmanship, and the growth of customized fashion offerings.

2. Emergence of new fashion categories

Post-pandemic, there has been a significant shift in consumer preferences towards multipurpose clothing. This trend, is driven by various factors, including changing lifestyles, increasing popularity of athleisure and streetwear styles and is expected to continue gaining momentum.

3. Value fashion: A switch to branded fashion

In recent years, the Indian apparel market has witnessed significant migration from the unorganized to the organized segment. This shift has made consumers more sensitive to the price-value mix, leading to the rise of value fashion price-points.

This move towards value fashion has created enormous opportunities for several retail players operating in this segment. These value fashion retailers offer trendy and fashionable clothing at affordable prices, making it accessible to a wider range of consumers.

With increase in brand consciousness across cities and towns and rising disposable income, the value fashion segment is poised for continued growth and success in the future.

4. Rise and Continued growth of E-com and D2C business models

As e-commerce growth normalises post-pandemic, it has moved beyond the large cities to tier II, III and smaller towns across the length and breadth of the country. The promise of easy access to large assortments at attractive prices has unlocked large cohorts of buyers in under-penetrated markets.

The D2C brands continued to increase their presence across the e-commerce landscape, showing a marked preference for driving user-engagement and sales through their brand websites. Several brands have invested heavily in technology to build a strong supply chain ecosystem and drive traffic to their brand websites. As reported by a top E-commerce solution provider, brand websites experienced higher volume growth YoY compared to marketplaces in the fashion segment. In the digital-first segment, fashion start-ups currently account for one of the largest shares, while also displaying promising potential for future growth.

Furthermore, social commerce, where social media platforms play a vital role in the entire shopping process, from discovering products to completing the purchase, has become increasingly important for brands across categories.

5. Omnichannel Shopping: Building delightful customer experiences

Apparel retailers are increasingly focused on providing customers with a seamless and consistent shopping experience across multiple channels. Shoppers are now looking for the omni experience, where they can seamlessly transition between online and offline channels, access a broader range of products, and leverage the convenience of digital tools while still enjoying the in-store experience. Hence, traditional EBOs are now transforming into "store of the future" models incorporating virtual and endless aisles, as well as online catalogues and trials.

This approach not only improves shopping experience but also enhances customer lifetime value and fosters greater customer loyalty. To achieve this, many retail players are collaborating with logistic companies to streamline their supply chain management and provide an integrated and efficient experience for customers.

6. Fashions Sustainable Future: The Shift Towards Ethical and Eco-Friendly Practices

Consumers are becoming increasingly conscious of the environmental impact of the clothing they purchase. As a result, sustainable fashion, also known as eco-fashion or ethical fashion, is becoming an increasingly important trend in the industry.

Brands are introducing organic cotton, bamboo, and linen, which are grown without synthetic pesticides and fertilizers. Recycled materials, such as recycled polyester and nylon, are also becoming more popular as they help to reduce waste and pollution.

Another key aspect of sustainable fashion is the use of sustainable production methods. This includes reducing water and energy consumption, using low-impact dyes, and implementing fair labour practices. As consumers become conscious about their purchasing power and environmental impact, it is expected that sustainable fashion production will become increasingly important.

7. Indias Growing Luxury Business

The increasing purchasing power and availability of a wide range of branded products have resulted in the emergence of aspirational consumers in India. They are now exposed to global brands and lifestyles, which have positively influenced their perception towards luxury products. The luxury market in India is relatively untapped with low penetration rate compared to several other developed and emerging economies. As a result, the market in India presents significant opportunities for both international as well as domestic brands.

Business overview

Your Company is Indias largest pure-play branded fashion and lifestyle entity with an elegant bouquet of leading fashion brands and retail formats.

Your Companys revenue stood at INR 12,418 Crore against INR 8,136 Crore last year, demonstrating a 53% growth. Companys EBITDA stood at INR 1,617 Crore with margin of 13%. Your Company added

more than 500 stores as it expanded its network to 3977 stores including 431 Pantaloons stores. Its total retail footprint increased to 10.8 million sq. ft vs 9.2 million sq.ft. last year.

Your Company has strategically established a portfolio encompassing various segments, categories, occasions, and price points. This empowers your Company to cater to a significantly wider range of customer preferences and desires, allowing to capture lucrative opportunities across multiple market segments and amplify the long-term growth potential. By creating such a varied portfolio, your Company is poised to adapt to ever-changing consumer trends and demands. The ability to respond flexibly to market dynamics fosters resilience and ensures sustained growth over the long term.

By adeptly targeting ethnic, luxury and digital-first segments, your Company has successfully unlocked new market segments, expanding customer reach and solidifying the market presence. Your Companys focus on specific occasions ensures customer relevance and engagement, instilling loyalty. Moreover, the accommodation of different price points secures your Companys accessibility to a wide spectrum of customers.

Today, your Company encompasses a collection of widely recognized brands and retail formats that cater to a broad range of consumer needs.

A) Super Premium and Luxury Retail

The Super Premium and Luxury market has been consistently growing through the COVID period aided by rising affinity for these brands.

The portfolio currently includes The Collective, one of Indias largest multi-brand retailers of luxury brands and select mono brands such as Ralph Lauren and the iconic British brands such as Fred Perry, Ted Baker, and Hackett London.

The Collective, presents a truly unmatched retail concept, known for its extensive selection of exclusive global brands. Curating the worlds finest fashion brands under one roof, this distinctive multi-brand retail format offers individuals with a one-of-a-kind perspective to express their unique personal style. The apparel offerings include formal, semi-formal, casual, denim and activewear from iconic international brands. The expansive collection of accessories includes watches, shoes, ties, belts, leather products, jewellery and sunglasses to create a perfect ensemble.

In FY23, the super-premium segment continued to grow profitably. The business grew approximately 60% over last year on account of strong L2L growth, expansion to newer markets and excellent performance in E-commerce channel.

By expanding its reach and presence in different regions, The Collective has been able to tap into previously untapped customer segments and increase its customer base. The brands growing website traffic and conversion rates, targeted marketing campaigns, and focus on E-commerce will help it to become one of the largest luxury e-commerce portals in India. The brand has continued strengthening its visibility and recognition aimed at maximizing buying efficiency, ensuring that customers have access to a suitable assortment of products.

Your Company has announced strategic partnership with Galeries Lafayette, Paris to open luxury departmental stores and a dedicated e-commerce platform. This format shall bring more than 200 luxury and designer brands under one roof, enabling your Company to create a world class destination of global luxury brands for Indian consumers. The first store under this partnership is under work and is expected to be launched next year.

B) Western wear brands

1. Lifestyle brands

Your Companys Lifestyle brands houses four of Indias iconic apparel brands, addressing diverse customer needs uniquely:

• Louis Philippe: To inspire the quest for excellence

• Van Heusen: To make professionals fashionable and trendy

• Allen Solly: To encourage unconventional thinking in the workplace

• Peter England: To bring alive authenticity and trust in relationships

Lifestyle Brands reported a revenue of INR 6,608 Crore up by 46% over the previous year. The EBITDA margin was positive 16.6% at INR 1,095 Crore compared to INR 788 Crore in FY22.

The Lifestyle business, at the back of its robust L2L growth, aggressive retail expansion and strong e-commerce growth achieved highest ever yearly revenues in FY23, maintaining their leadership position and expanding their loyal customer base to over 26.3 million satisfied customers.

Premiumization and casualization are the two key drivers contributing to growth for these iconic brands. In the past year, along with formal wear, categories such as denim, suits and blazers, T-shirts, and accessories have posted significant growth. The womenswear and kidswear businesses have made remarkable advancements and are ready for their next phase of growth.

The business also intends to enhance its womens product range across various occasions and distribution channels.

After a two-year hiatus, the brands intensified their advertising investments to strengthen the brand identity, renew their communication and engagement with customers. Brands have maintained their momentum in expanding their digital presence through and online marketplaces. Furthermore, the Buy Online Ship from Store (BOSS) network has also grown to around 2000 stores facilitating rapid scaling up of Omnichannel capabilities across the country. The small-town network has experienced impressive growth with overall network of about 600 stores with a strong presence across all the brands.

Lifestyle brands have cemented their leadership positions in the respective segments and are now closer to their customers.

Overview of Key performance indicators ("KPIs"):

Lifestyle brands (Retail KPIs) FY18 FY19 FY20 FY21 FY22 FY23
Walk-ins (Crore) 0.82 0.79 0.72 0.39 0.43 0.95
Conversion 46% 50% 55% 83% 89% 90%
Average selling price ("ASP") 1,747 1,714 1,626 1,680 1,701 1,881
Average bill value ("ABV") 4,211 4,256 4,072 3,693 3,844 4,576
Items per bill 2.4 2.5 2.5 2.2 2.3 2.4
like-to-like ("LTL") volume growth 8% 4% 3% -9% 25% 26%
LTL ASP growth 0% 1% 1% -11% 16% 12%
LTL value growth 8.6% 5.3% 4.5% -19.6% 46% 40%
No. of Stores 1813 1980 2253 2379 2522 2650
Total Retail Area (mn. sq.ft.) 2.40 2.56 2.83 3.01 3.24 3.55

2. Youth Western Fashion

American Eagle is among one of the top choices for "Premium Denim" in India, given its reputation for premium product quality, diverse range, and an elevated shopping experience across channels. These factors have helped the brand establish a strong presence and resonate with Indian consumers. The brands revenue grew by 89% over last year on the back of strong L2L growth and improved accessibility. The brand expanded into newer markets through owned stores and department store doors, well supported by marketing campaigns that have resulted in increased awareness among its target customers.

Forever 21 is building a viable retail and scalable E-commerce model, and is rapidly evolving as a preferred brand for young and fashionable consumers. During the year, the brand continued to expand in newer markets with a higher propensity for fresher and more youthful fashion. Through the increased contribution of mens clothing, the brand has successfully evolved into a comprehensive one-stop-shop for all fashion needs. It has adopted a strategic approach to ensure deeper consumer connect by optimizing store layouts and product assortments for a more impactful presentation of merchandise. The brand is continuously enhancing its margins by leveraging improved scale and effectively utilizing local sourcing to its advantage.

Reebok is an established global brand in the sporting goods industry with a rich sports legacy. Reebok develops products and technologies that connects with the consumers fitness priorities - whether its functional training, running, sports, walking, dance, yoga or aerobics.

Your Company acquired Reebok India business through signing of agreements in FY22, to strengthen its sportswear portfolio in the youth fashion space. From 1st Oct 2022, the Reebok business transitioned into ABFRL and has commenced expanding its presence by launching new stores, relaunching its website, and initiating marketplace operations. The brand has also signed a set of new ambassadors and launched a fresh marketing campaign "I Am the New" to build a leadership position in sportswear category in the country. The brand continues to have a strong focus on retail expansion, scaling digital business, offering multiple category products, and rebuilding a fresh brand identity.

3. Van Heusen Activewear, Athleisure, and Innerwear

The innerwear and activewear market in India has seen several trends and developments in recent years, driven by the growing demand for comfortable and high-quality products and increasing popularity of online shopping. Per report by Wazir advisors, the innerwear and activewear market is set to grow to approximately INR 1.1 trillion by 2025.

Your Companys foray into the innerwear and athleisure market through its brand, Van Heusen, has met with notable success in a short period of time. Since 2016, brand has consistently scaled its distribution network and now has a vast multi-brand outlet (MBO) footprint of more than 32,000 trade outlets and the EBO network of 175 stores. The brand is also now available across key departmental stores, and large e-commerce platforms.

The brand is making consistent efforts to enhance the sales experience for both its distributors and end-consumers. It is achieving this by focusing on building a robust online presence and refining its supply chain operations. Its ecommerce platform, Van Heusen Intimates, caters exclusively to womens lingerie, lounge wear, athleisure, and activewear needs and operates at the intersection of content and commerce.

Van Heusen Innerwear offers a comprehensive collection that blends stylish designs with advanced product features, providing exceptional comfort and fit. The brand is dedicated to its consumer-centric philosophy and continuously introduces innovative products for both men and women. Each collection caters to different consumer segments, offering a unique range of choices. The brand has successfully launched a pilot kidswear line on its website and select MBOs.

The brand has accelerated its marketing efforts as it launched its first-ever national television and digital campaign. Furthermore, the brand is working on creating an impressive retail identity pegged on innovation and fresh fashion. These initiatives are aimed at strengthening the brands visibility and creating resonance with its target audience.

The brand is relentlessly working towards enhancing the customer experience, curating a relevant product assortment for both offline and online channels, driving product innovation and category extensions, and establishing a strong position to spearhead the growth of the brand.

C) Ethnic wear Brands

The ethnic wear market is the largest segment in Indian apparel industry. This category accounts for around 30% of the overall apparel market in the country and its organized market is expected to grow at a CAGR of over 17% per reports. The market has witnessed high traction on account of a shift from tailored wear to ready-to-wear, and rising interests of millennials to deepen the connect with their culture. The market is characterized by a wide range of price points, with both high-end and affordable options available. At the higher price point, the ethnic

market offers luxury and premium products that showcase exquisite craftsmanship, intricate detailing, and high-quality materials. The ethnic market also thrives at lower price points by offering affordable options that are accessible to a broader customer base. These budget- friendly products embrace ethnic aesthetics and incorporate cultural influences while ensuring affordability.

Your Company has already built a comprehensive portfolio and is present across multiple occasions and price points. The collaboration with celebrity designers such as Tarun Tahiliani and Sabyasachi allows your Company to have a strong play in the luxury wedding and super premium space. TASVA was launched in partnership with Tarun Tahiliani to specifically address the need for mens good quality wedding and celebration ensembles. Brand Shantnu and Nikhil with their couture and pret line, is now ready to grow further. Jaypore has established a viable retail model and the business is set to grow rapidly across channels. Your Company also completed the transaction to acquire celebrity designer Masabas "House of Masaba" brand in FY23 that aims to create a young, aspirational and digital-led play in apparel, beauty and personal care business.

Jaypore is Indias leading premium artisanal brand for apparel, jewelry and accessories with 18 exclusive offline stores across 9 cities and a robust e-commerce platform which allows customers from around the world to purchase their products. The brand witnessed approximately 90% growth over last year on account of strong offline expansion and introduction of new categories like home, jewelry and mens wear.

Shantnu and Nikhil appeals to contemporary luxury shoppers with designs that cater to the clothing preferences of millennials. They offer Occasion and Ceremonial contemporary apparel for men and women across 15 stores in more than 7 cities. Apart from the couture line, S&N by Shantnu Nikhil, the bridge-to-luxury brand launched in 2020 has been very well received by the customers.


In partnership with Tarun Tahiliani, Your Company forayed into affordable premium mens ethnic wear by launching a new brand, TASVA, in FY22. Tasva addresses the ceremonial wear needs of Indian men with high quality products at sharp price points. The brand offers an exquisite blend of innovation and tradition with contemporary tailoring and fits. Tasva is now available across 51 stores in 30 cities. The brand has rolled out a national campaign "Ek Naya Nazariya" in collaboration with its newly signed brand ambassadors. The brands products saw consistent traction at the back of premium finish and feel, infusion of fashion and innovation and its contemporary take on traditionalism.

House of Masaba was transitioned into your Company in FY23. House of Masaba is a young, aspirational and digital-led brand across the affordable luxury segment in the fashion, beauty and accessory categories. The brand has 8 stores in 5 cities and poised for rapid expansion. The brand launched a new beauty and personal care line named "LoveChild" with a wide range of products across categories. With its foray in the promising apparel and beauty business, the brand is poised for accelerated growth.

Marigold Lane is a premium womenswear ethnic wear brand for contemporary Indian women. Marigold Lane is present across 75+ Pantaloons doors and 11 select EBOs.

Sabyasachi aspires to establish itself as a global Indian luxury brand, offering bridal wear, ethnic wear, handcrafted jewelry, and accessories. The brand continued to grow profitably and has maintained its status as the preferred choice for celebrity weddings. It has meticulously developed a strong presence by staying deeply entrenched in the Indian cultural heritage. The brand has 8 exclusive stores across 6 cities including New York. Sabyasachi in line with its global expansion strategy opened its first-ever exclusive brand store in New York in Oct 2022, which has been well received by customers.

D) TMRW: A portfolio of digital-first brands

The Indian E-Commerce market is expected to be USD 135 Billion by FY27, with 450 Million consumers. The growth is supported by strong underlying fundamentals such as large consumer base with growing affluence, growing Internet and smartphone penetration enabled by low data prices, and low shipment costs. Fashion and Beauty and Personal Care are projected to be largest online categories with a market size of USD 37 Billion by FY27.

India has also witnessed a massive scale-up of digital-first brands with increasing share of E-Commerce garnering greater than USD 2 Billion funding in the last 5 years. Consumers especially millennials and Gen Z that are digital native, are experimenting and adopting new age brands with loyalty and repeat purchase behaviour taking effect over time for leading brands. Brands that are Born on Instagram, Born on Shopify or Born on Marketplace Platforms will continue to disrupt and grab share from leading brands by adopting a cross-channel expansion path. The estimated addressable market for digital-first brands in fashion and lifestyle is expected to be USD 15 Billion by FY27.

In April 2022, your Company set-up a new entity "TMRW" to capitalize on this growing opportunity. TMRW is well positioned to become a leading House of Brands player by building on the strong ABFRL and ABG foundation, bringing in deep E-Commerce as well as technology capabilities and an ability to deploy capital with a long-term view. Your Companys strategy is to focus on

fashion and lifestyle category and build the next generation of iconic brands that consumers love. TMRW shall work with D2C founders that have identified product market fit and help them scale rapidly.

Your Company will have a focused play in few attractive sub-categories:

• Large addressable market categories (e.g. Casual, Womens Western, Womens Ethnic)

• Emerging high growth categories (e.g. Athleisure and Active, Expressive Wear, Womens Fashion, Beauty and Personal Care, etc.).

A healthy mix of brands with D2C and marketplace footprint

E) Masstige & Value Retail

1. Pantaloons

Pantaloons reported annual revenue of INR 4069 Crore, up by 55% over last year, while EBITDA stood at INR 635 Crore compared to INR 368 Crore last year. The EBITDA margin was 15.6% for FY23 up from 14% last year. The brands performance has remained strong, even though value and masstige fashion segment has been impacted by sustained inflationary pressures, particularly in the second half of the fiscal year.

Pantaloons is one of the most widely known retailer in the masstige segment of the Indian fashion retail industry. The brand recently marked its 25th anniversary by launching several successful campaigns and engaged with its customers. The brand continued to expand aggressively by adding 54 net stores to the network in FY23, bringing the total number to 431 stores. This year, Pantaloons strengthened its private label portfolio with the launch of "Coolsters" for tweens and "7 Alt" a casual wear brand for men, while sharpening the design aesthetics of its existing private label portfolio. Pantaloons has consistently pursued sharp markdown reductions, resulting in better value realizations for its customers. This approach has enabled the brand to enhance its reputation for delivering quality and fashionable products at affordable prices to Indian middle-class customers.

Overview of KPIs:

Pantaloons (Retail KPIs) FY18 FY19 FY20 FY21 FY22 FY23
Walk-ins (Crore) 4.6 5.4 5.7 2.3 3.6 6.2
Conversion 22.4% 24.3% 26.1% 31.5% 26.2% 21.6%
ASP 665 643 665 649 727 813
ABV 1,842 1,880 2,001 2,075 2,325 2,468
Items per bill 2.8 2.9 3.0 3.2 3.2 3.0
LTL volume growth -3.3% 3.1% -2.1% -50.5% 18.0% 31.5%
LTL ASP growth 0.8% -1.7% 4.9% -1.7% 12.7% 12.1%
LTL value growth -2.6% 1.4% 2.7% -51.3% 33.0% 47.5%
No. of Stores 275 308 342 346 377 431
Total Retail Area (Mn. sq.ft.) 3.76 4.02 4.36 4.46 4.92 5.72
HS vs Mall Store Mix 39% 40% 42% 42% 44% 48%

HS - High street

Pantaloons has made significant progress in delivering delightful shopping experience to customers across channels and geographies, with over 120 stores adopting the brands new retail identity and the launch of multiple innovative campaigns. Additionally, the brand has scaled its E-commerce channel by introducing a mobile application, while also making notable improvements in technology and logistics. The brand is on track to build truly Phygital stores through a revamped loyalty program and improved digitalized shopping experience at stores leveraged through Omni-channel play. It has scaled up omni-network to around 300 stores. With these advancements, Pantaloons is well-positioned for significant growth in the future.

Pantaloons Private labels meeting needs of consumers across occasions and age groups.

2. Style Up

Style Ups value proposition is uniquely designed for value-conscious fashion shoppers, aiming to offer stylish and trendy everyday fashion at budget-friendly prices. Style Ups consumer base is spread across diverse markets, spanning from metros to smaller cities and towns, throughout the country.

In FY23, Style Up relaunched its identity, including a new logo, refreshed products and enhanced experience at stores. This new initiative has received an overwhelming response from its customers. Your Company will continue to assess the market and its potential across various locations.

Business strategy:

1. Building Strong Brands

Your Company is known for having built Indias iconic apparel brands. These brands have attained their distinguished status through a continuous process of product innovation, which is supported by a strong and expansive distribution network that drives access to customers. Your companys success in building these brands has been driven by world-class marketing campaigns that effectively connect with customers on a deeper level. These brands represent your Companys most valuable strategic assets and are continuously evolving to adapt to changing customer preferences.

With several brands in the growth phase, your Company has a unique opportunity to transform these emerging brands into iconic ones. Your Company has already built a meaningful presence in the innerwear, casual, sportswear, ethnic, super premium, digital-first segments, and is further leveraging existing knowledge and insights to foster the development and success of these brands.

2. Wide and Deep Distribution Network

Your Companys business boasts of an extensive distribution network, making it a dominant player in the countrys fashion retail landscape. With around 4000 stores and 32,000+ points of sale, your Company has strategically positioned itself to cater to a vast customer base across regions.

As your Company has successfully established a strong presence in its current markets with an extensive distribution network, it shall pursue expansion into newer markets. Expanding its existing and newer brands into untapped regions presents an exciting growth opportunity for your Company to broaden its customer base. Your Companys strong brand reputation and customer loyalty cultivated in its current markets can serve as a valuable asset in the new markets. Investing in localized marketing and understanding the unique challenges and opportunities of each region will be instrumental in fostering a strong connection with the target consumers.

3. Penetrating into tier II and III markets

Tier II and III markets continues to play a vital role in the countrys growth narrative owing to their progress in the real estate landscape, work environment, quality of life and digital penetration.

With value space set to grow exponentially, tier II and III will be key drivers of growth. Peter England Red, Allen Solly Prime, Van Heusen Gold, Louis Philippe All Star are specific smalltown format of the Lifestyle brands. With a robust network comprising 600 stores, these brands are set to fuel your Companys next phase of growth. Pantaloons, too, is well placed to capture a significant portion of this opportunity with evenly distributed presence across metros, tier I, II and III cities. Style Up was relaunched with a new brand identity offering quality fashion for every occasion with a special focus on small towns with population more than one lakh.

By actively targeting tier II and III markets, your Company is tapping into a rapidly growing market segment, poised for exponential growth. Its commitment to delivering value, quality, and high fashion that resonates with the aspirations of consumers in these cities positions it as a preferred choice. Leveraging its extensive network, brand strength, and understanding of local preferences, your Company is well-equipped to capture a significant portion of the opportunity presented by tier II and III cities, thus driving its growth and market leadership.

4. Online Acceleration

According to reports, online retail spending in India is projected to increase six-fold to reach USD 300 billion by 2030 attributable to the rising number of digitally influenced and online shoppers. Your Company remains uniquely positioned to capture the above growth given its branded offerings across segments, categories and price points.

In FY23, your Company launched a new super app for Lifestyle brands, laying the foundation for the inclusion of other brands in the future. The launch of and Pantaloons mobile app witnessed significant traction, and are now set to increase its share in overall portfolio through improved customer experience and reduced lead times. Besides this, several other brands also continue to focus on their website as plays an important role in establishing brand identity, and building brand loyalty. Your Company will continue to build omni-capabilities to improve customer retention, generate higher customer lifetime value for business and leverage extensive store network.

By accelerating the growth of the online channel and leveraging the power of digital platforms, your Company aims to seize the opportunities presented by the evolving retail landscape, ensuring sustained growth and long-term success.

5. Building a Diverse Portfolio with presence in High-Growth Categories

Your Company is focused on expanding its portfolio by venturing into attractive and new high- growth categories.

Van Heusen Innerwear has already established a strong presence in the country and will continue to lead through an aggressive network expansion, product leadership, and innovation capabilities.

Reebok is exceptionally well positioned to become one of the leading sportswear brands in the country, with focus on retail expansion and scaling up its digital business.

Your Companys brands such as Van Heusen, Allen Solly and Forever 21 has already built a reasonable presence in womens western wear category. It will continue to nurture and scale it significantly. Pantaloons continued to strengthen womenswear category by introducing new products to appeal young women.

The Fashion accessories market has experienced substantial growth, driven by personalization, wide range availability with the convenience of E-commerce. The Handbags and Footwear category of the Lifestyle brands have shown promising growth. Sabyasachis jewelry and accessories business is set to be a major revenue driver in the coming years. Pantaloons has also expanded into the home category with Living Scapes and is actively strengthening and scaling up its accessories segment.

Your Company forayed into affordable premium mens and womens ethnic wear by launching TASVA and Marigold Lane respectively. Collaboration with Tarun Tahiliani and Sabyasachi allows your Company to have a strong play in the fast-growing luxury wedding and designer wear market.

TMRW was set up with an aim to create a rich portfolio of digital-first disruptor brands in fashion and lifestyle segment. TMRW has already established a strong portfolio of 7 brands across multiple large and growing categories such as kids wear, denim wear, casual, western wear and athleisure. Over the next three years, TMRW will continue to acquire as well as incubate 30+ innovative, customer-obsessed brands within a synergistic house of brands play.

By diversifying its portfolio across these high-growth categories and leveraging the strength of its brands, your Company is well-positioned to capture market opportunities, drive growth, and deliver value to its customers and shareholders.

Building a meaningful play in super premium and luxury segment

The Indian luxury landscape is constantly evolving and has witnessed significant growth in recent years driven by increasing income levels and wealth of the countrys middle and upper class, rise of E-commerce platforms and proliferation of international luxury brands in the country. Luxury and super premium segment are set for rapid double-digit growth over the next few years.

The portfolio of super premium brands has already surpassed its pre-pandemic levels and shall sustain its growth trajectory. This achievement can be attributed to the increased reach of the E-commerce channel, expansion to newer markets and better engagement with consumers. In pursuit of capturing this lucrative market, your Company has entered in a partnership with French luxury department store chain Galeries Lafayette to extend its luxury play across all categories through a multi brand format. Your Company plans to open destination stores in prime locations along with a dedicated E-commerce platform to cater to other markets.

By leveraging this collaboration and capitalizing on the evolving luxury landscape, your Company is well-positioned to establish a credible and impactful presence in the super premium and

luxury segment. Your Companys commitment to deliver exceptional quality, curated offerings, and an unmatched customer experience will drive growth and solidify its position as a leading player in the luxury market.

Digital Transformation Roadmap

Your Company remains committed to its digital transformation journey, leveraging the strength of its brands. It has made significant strides in enhancing its digital presence and capabilities and continued focusing on building a brand-led E-commerce ecosystem that seamlessly integrates with its offline business model.

Through in-house development, your Company has created a robust E-commerce platform that empowers individual brands or a group of brands to have their own dedicated websites, mobile sites, mobile apps, and virtual stores. This approach allows for a tailored and immersive digital experience that aligns with the unique identity of each brand. Additionally, seamless integration with over 10 different marketplaces further expands the reach and visibility of the brands in the digital landscape.

A key aspect of the digital transformation roadmap is the implementation of a unified order management and supply chain system. This system provides a single view of inventory, including warehouses and stores, across all digital channels. The integration of inventory data ensures efficient fulfilment processes and enables seamless omnichannel capabilities. Customers can enjoy a consistent shopping experience, whether they choose to shop online or in-store, with the convenience of accessing a wide range of products and services. Your Company has successfully established a robust omnichannel infrastructure, with around 2000 brand stores and around 300 Pantaloons stores now fully omnichannel enabled.

This year, your Company achieved significant milestones in its digital transformation journey.

- Pantaloons scaled up its website and mobile app, incorporating hyper-personalization capabilities.

- Lifestyle brands launched a new multi-brand website and app with plans to add more brands in the future.

- TASVA introduced its dedicated website.

- LoveChild by Masaba, the newly launched cosmetics brand, flagged off its own website.

These initiatives enhance the online shopping experience and cater to specific customer preferences. Your Company continues to invest in digital platforms to engage customers and drive growth.

Your Company has prioritized the enhancement of its e-commerce platform, focusing on personalization, hyperlocal capabilities, content management, and performance optimization.

Integration with analytics and marketing automation platforms enables customer funnel tracking and real-time notifications. The implementation of a cloud-based Point-of-sale system across over 2000 stores enables seamless omnichannel capabilities and quick delivery of online orders.

Core IT systems have been modernized and automated, including the upgradation and consolidation of multiple ERP platforms across businesses and the rollout of cloud-based ERP for new businesses. A company-wide data warehouse has been established for reporting and MIS, promoting data democratization. Innovative developments include a Single View of Customer mobile app for Store Managers, a Markdown Management System utilizing AI/ML, and analytics. These initiatives strengthen your Companys digital infrastructure and optimize operational efficiency.

Human Resources

Your Companys philosophy of The Biggest Brands and Best People fuels it to give its best. While your Company has several well-known brands under its umbrella, the people behind the brands make it a power-house. You Companys unique Employee Value Proposition (EVP) - A World of

Opportunities makes it a preferred employer for professionals in the industry.

FY 23 Human Resource Achievements

• Unwavering commitment to fostering internal talent growth, resulted in 17% of employees getting new roles.

• Consumer grade experience of key HR processes provided to 24,810 retail employees by implementing Alt Life HRMS program through simplified, tech-enabled app-based HR process.

o Power BI Dashboards were launched for HR & Business teams with Line manager and store manning dashboard receiving the highest usage

o Institutionalized HR Service Delivery for seamless employee experience, standardization of processes under a single platform

• Ethnic businesses experienced valuable talent infusion from Jewellery, Beauty and Personal Care, and accessories sectors. Furthermore, a successful talent ramp-up has been achieved for TMRW, further enhancing the overall strength of the organization.

• Deployment of Gig workforce in 150+ stores of Pantaloons PAN India resulting in manpower savings. Also, 850 apprentices hired in MFL in FY23 resulting in savings.

• Significant boost in engagement as a result of our strategic focus on cohort-based properties on social media, in line with EVP. Additionally, successfully designed and launched campus initiatives, namely Pantaloons Next Top Designer (NTD), which garnered an impressive 900+ applications, and Showstopper, which received a staggering 10,965 applications from over 300 esteemed business schools.

• In a pioneering move within the industry, we successfully implemented a Digital Health Assessment with follow-through for over 9,900 front-end, head office, and zone employees.

o This initiative marks a significant milestone, underscoring our commitment to prioritizing employee well-being.

o Furthermore, targeted programs focused on enhancing physical, mental, emotional, and financial wellness were launched.

• Developed a solid footing on social media, with a surge of 12,000 (500% growth over LY) new followers on our Instagram account "Life At ABFRL", and an astounding 140,000+ fresh additions to LinkedIn family which makes it a total followership of 400 K.

1. Talent Management and Career Growth

The Employee Value Proposition at ABFRL has two key pillars — Career growth and development. Focused initiatives under these pillars prepare our employees to unleash their potential and achieve personal and professional goals aligned with the organisations strategy.

Your Company has institutionalised Talent Councils that actively review the organisations talent pipeline, succession plans for key roles and requisite development interventions. The succession

planning ensures that all roles are reviewed for their criticality by the management team and a strong pipeline of talent is identified as successors for these roles. We have in place annual career conversations, which are structured to understand employee aspirations, provide them a clear vision of their career path.

To support continuous learning and growth, your company has partnered with well-known educational platforms, and your Groups inhouse Gyanodaya Campus for classroom programmes. These provide employees with a plethora of opportunities to develop and grow in their careers. Exposure to leaders through mentorship and coaching help employees learn from the experiences of industry stalwarts and be future ready. All these initiatives and efforts by the organisation have helped retain employees and keep them engaged.

Your Companys focuses on the career movements of employees to ensure they get diverse experience in terms of functions, geographies, and formats to facilitate your Companys efforts to build all-round leaders across the organisation. Your Company drives the philosophy of giving diverse experiences to young talent in the formative years of their career and emphasise 2*2*2 experience (2 Business units * 2 Functions * 2 Locations).

Young Talent

Your Company has a Young Talent Program that is designed to attract and nurture young professionals across various disciplines such as Business Management, Fashion Management, Chartered Accountancy, and Retail Operations.

Learning and Development

Transition to circular economy is changing the way your Company works. In this evolving ecosystem, the focus is on behavioural and functional learning, knowledge, and skills development of employees, empowering them with the right knowledge. This also enables us to develop future-ready leaders.

The learning of employees is anchored by our internal capability-building academy, ABFRL University as well as Gyanodaya, the Aditya Birla Group Global Centre for Leadership. There are several leadership development programs that are focused on strengthening three key areas - Leading Self, Leading Digital, and Leading Others. These initiatives help build competence in the following areas: Personal Leadership, Financial Acumen, Immunity to Change, Digital Transformation, Employee Relations, Sustainability, Problem Solving, Analytics, and Presentation Skills.

2. Rewards and Recognition Remuneration and Benefits

Our approach to rewards at ABFRL is drawn from our overall people philosophy.

Your Company has a comprehensive, agile, balanced and inclusive approach towards remunerations and benefits and our rewards programme aims to attract, engage and retain top class talent in the industry. Our rewards value proposition is anchored in Total Rewards where we incorporate both the monetary (Fixed Compensation, Variable Pay and Long-Term Incentives) and the non-monetary elements (Benefits, Recognition and Work-Life Effectiveness).

Pay decisions are rooted in pay for performance, long-term potential of the individual and competitiveness with respect to our market peers.

We strive for absolute non-discrimination in pay because of gender, age, and/or experience of the individual and we have fairness measures in place for specific scenarios such as maternity leave and talent mobility across the businesses. We continuously review our people productivity to prepare the organization to be future-ready in the context of changes happening at Work, Workplace and Workforce.

Our reward approach lays significant emphasis on programmes that incentivize both short-term and long-term business performance. We have also put in place fairness measures in certain scenarios such as maternity leave, inter- or intra-business transfers.


There are multiple platforms for recognition for employees and teams, whether at the ABG level, ABFRL level or at a business level. The ultimate celebration of success happens at the Groups annual event - Aditya Birla Awards, which recognizes outstanding players and teams, who have displayed commitment and passion towards their craft.

Enrich Your Life

Your Companys vision is to provide a fulfilling workplace for our employees, where everyone feels valued and supported as an individual, and not just an employee. At ABFRL, we are consistently working towards creating a supportive, friendly and happy workplace. Our Leave Policies, Work from Home policy, Flexible Work Arrangements, and Employee Wellness Programmes aim to impart a healthy work-life balance for employees to better manage their professional and personal commitments.

Employee Wellness Initiatives

Employee Wellness has always been one of the priority areas in enriching life and strengthening the Employee Value Proposition at ABFRL.

In this regard, we pioneered a three-pronged approach - Physical, Emotional and Financial Wellness initiatives to rollout a holistic employee wellness and wellbeing agenda.

Digital Health Assessment (DHA)

To focus on the health and wellbeing of our employees and encourage our workforce to stay healthy and focus on their health, Company launched a holistic wellness initiative for its workforce. The stages of the initiative include: -

o Self-guided Digital Health Assessment

o Stratification of all employees in high, medium and low risk categories o Company sponsored diagnostic tests for employees in high risk categories

o Graded support programs to employees in high and medium risk category and work stress reduction plan

o Rolling out wellness policy for store employees

Businesses also adopted a policy of allowing employees to take a 7-day break from work and do something purposeful, something which allows them to follow their passion like voluntary teaching, donating, investing in self-learning and development etc.


The organizations core values of Seamlessness, Passion, Speed, Commitment and Integrity have guided the actions of your Company and are the key to why your Company attracts the best talent. These values come alive in the daily processes and practices that leaders and employees follow.


Your Company encourages open and honest communication among teams and through leadership. There are various formal and informal platforms including open houses, town halls, and anonymous survey touch points through, which employees are encouraged to ask questions and share feedback. The open work atmosphere across the Company has ensured two-way healthy communication between leadership and employees. The VIBES and HR stakeholder survey have helped management understand the pulse of employees across various experiences and stages. Your Company has engaged top talent across businesses through a series of interventions planned and implemented for various groups. There were regular leadership connections and development journeys designed for high-performing employees across your Company.


As a responsible consumer-centric organisation guided by the Aditya Birla Groups key principles since its inception, sustainability has been deeply ingrained in your company business strategy and is fundamental to ABFRLs endeavours. As the market leader, your company prioritises meeting consumer demands by striving to deliver products with better environmental and social footprints.

Your Company believes that economic growth must be achieved in synergy with environmental and societal interests. Thus in 2013, your Company embarked on a structured sustainability programme, ReEarth for our Tomorrow which comprised of 10 Missions namely Energy, Carbon Footprint, Green Building, Water, Waste, WASH Pledge, Safety, CSR, Packaging and Sustainable Products with annual targets, clear responsibilities and timelines. ReEarth is a movement to give back more than we take from the ecosystem.

After achieving significant milestones in 2021, your company embarked on ReEarth 2.0, shifting focus from being process-led to product-led with a 2025 agenda that emphasises product design and development, customer-centricity, and supply chain sustainability. This 2025 roadmap aims to achieve ambitious sustainability targets and business goals while balancing risks and opportunities for all relevant ESG initiatives.

Your Company has put in place a strong governance mechanism that effectively oversees its sustainability agenda and goes beyond just meeting compliance requirements. The Management Committee periodically reviews sustainability strategy and initiatives, while the Risk Management and Sustainability Committee (RMSC) monitors and reviews the risk management plan and other delegated functions related to sustainability. Organisational risk and governance practices are mapped in-line with the Task Force on Climate-related Financial Disclosures (TCFD) and Committee

of Sponsoring Organisations (COSO), globally accepted climate risk framework and Enterprise Risk Management framework respectively.

Your Company is committed to transition to sustainable fashion by building adaptable and flexible high-performance business models, promoting life cycle thinking, sourcing responsibly, embracing circular economy principles, and ultimately mitigating or eliminating negative impacts on the environment caused by the use of fossil fuels.

As discussed in detail at COP 27, waste management is one of the key material issues and a major bottleneck for the fashion sector. To address it, ABFRL is creating closed loop systems where waste generated is recycled or reused and converted to useful resources. The entire non-hazardous waste across your companys facilities is either recycled or reused, and a small quantity undergoes composting. Zero Waste to Landfill has been achieved across operations and going forward, your company is exploring innovative ways to reuse production line waste in inhouse products, thereby reducing ever increasing demand for raw materials. Along with existing collaboration with International Council for Circular Economy (ICCE) and Circular Apparel Innovation Factory (CAIF), your Company has taken a large stride in its circularity journey by entering into a collaboration with the GIZ, a German Government agency, in a private-public development partnership project which aims to strengthen circular business practices for the Indian market.

Your Company also participates in and collaborates with various global platforms and ESG indices. These strategic collaborations and participations have helped your Company stay relevant by ensuring alignment with global as well as national sustainability agendas, and presented it with an opportunity to benchmark its sustainability performance against both domestic and global peers.

Across the years, your Companys sustainability journey has been widely appreciated and has garnered global recognition and accolades. This year too, your Company received accolades from prominent forums and organisations. Some of the notable instances include:

• Retained Asias most sustainable company and a global rank of 8th (eighth) at the S&P Global - Corporate Sustainability Assessment in the textiles, apparel and luxury goods sector

• Achieved a global rank of 12th under Textiles and Apparel sector with a score of 12.15 (Low Risk Category) after being assessed for the 1 st time by Sustainalytics, a global ESG Rating Standard of repute

• Received ESG India Leadership Awards 2022 in the category of Leadership in Green Supply Chain by ESG Risk

• Committed towards being a signatory of United Nations Global Compact through adhering to its 10 principles

• Awarded ESG Trailblazers at the ESG World Summit and GRIT Awards 2022

• ABFRL - LBRD WAREHOUSE of Aditya Birla Fashion and Retail Limited, Bengaluru, achieved Platinum certification under IGBC Green Factory Building Rating System

• Received TRUE Zero Waste Gold certification for its manufacturing site from Green Business Certification Inc. (GBCI)

This year, your Company is planning to validate its climate and emission-related energy and emission targets through the Science Based Targets initiative (SBTi). This additional step will help align internal goals with the international target of keeping the global temperature below 2?C.

At ABFRL, sustainability and fashion are not a paradox, and over the years, sustainability has been integrated into the brand and embedded in the business core. Your Company is committed to maintain its unwavering focus on sustainable fashion, and plans to leverage innovation and technology as catalysts for the journey ahead.

Risk management

Your Company recognizes the importance of a robust governance structure and effective risk management in ensuring sustained performance and growth. This year, significant strides have been made in enhancing the risk management framework. An integrated approach has been adopted, combining the COSO framework with the Task Force on Climate-related Financial Disclosures (TCFD), to strike a balance between financial, social, and environmental priorities. This approach aligns risk management with performance and strategy, delivering long-term value to stakeholders.

To oversee the identified risks and mitigation plans, a dedicated Risk Management and Sustainability Committee (RMSC) has been established. The committee, supported by the Chief Risk Officer, Head of Sustainability, and Risk Management Committees, continuously monitors and evaluates risks from strategic, operational, financial, environmental, and compliance perspectives. Internal and external business environments are carefully monitored to identify potential risks and opportunities.

Periodic assessments by the established committees and internal functions ensure ongoing evaluation of risks. Mitigation plans are implemented to manage key risks and minimize residual risks, safeguarding the companys interests. This proactive risk management approach provides the foundation for effective decision-making and resilience in the face of evolving challenges.

Key risks:

1. Changing customer trends

Over the last few years, consumer preferences, behaviours, and consumption pattern have changed triggered by COVID leading to deep ramifications on how people buy and consume goods and services. This behavioural change coupled with technological emerging trends are re-shaping the retail landscape in India with long-term implications. These factors have the potential to negatively impact your Companys ability to accurately forecast customer demand, leading to a higher rate of inventory obsolescence and/or missed sales opportunities. Further, demand continues to grow for cheaper merchandise curtailing the market for quality fashion.

To manage this risk, your company has implemented several strategies, including establishing new segments across different occasions and price points through brand extensions and sub-brands, pursuing growth opportunities via acquisition, joint ventures, and licensing, and exploring new partnerships with e-commerce partners. Your Company also focuses on innovating its product lines and expanding its consumer base by adopting a category approach. This approach allows your Company to better target the needs and preferences of consumers and differentiate the products from those of competitors.

2. Global Slowdown and impact of adverse Macro Indicators

Global slowdown has a bearing on Indian economy and consumption, leading to enhanced volatility in the markets. This can lead to slowdown in exports market, disruption in supply chain, fluctuation in raw material prices and increase in cost of capital. Inflationary pressure and consequent rise in interest rates can dampen the consumer sentiments, particularly in small towns.

Your Company has offerings across occasions, categories and price points ensuring wide reach. Your company continues to innovate by introducing new products or designs that appeal to customers and can help the company maintain or increase its market share. These strategies help in adapting to market fluctuations and addressing changing consumer preferences.

3. Increase in competition intensity

Your Company operates in a highly competitive industry which is characterised by rapid shifts in consumer trends and technology. This dynamic environment can lead to pricing and demand volatility, impacting the competitive landscape. Due to the expansive nature of our business, your Company faces competition from various domestic and international players operating in retail, wholesale, and e-commerce space. Some of these competitors may have access to greater financial and marketing resources and, therefore, giving them an advantage in adapting to customer needs and taking advantage of opportunities or responding to threats.

In order to maintain its position as a leading apparel company, your Company has implemented a range of strategies, including extensive brand building, leveraging technology to enhance the customer experience, establishing omni-channel networks, and forming partnerships with both online and offline market players to have multi-category play.

4. Data security

Due to increased digital exposure in business, there is a threat to leakage of critical business information, customer information and sustenance of operations in the event of a cyber-attack, internal data breach and downtime of critical business systems. This could potentially result in financial losses and have a negative impact on the brand image.

The risk is mitigated through establishment of Disaster Recovery (DR), Business Continuity Plan (BCP), Data Loss prevention (DLP) and Security Information and event management (SIEM) technology. Periodic monitoring and reporting of incidents are conducted, including the identification of root causes for each incident and ensuring that they are addressed appropriately.

5. Talent retention and attraction

With your Company rapidly expanding on multiple fronts there is need of talent in key functions like design, marketing, retail and e-commerce. The fashion retail industry being extremely fastpaced and competitive there is shortage of skilled professionals who can help meet the needs of consumers and stay ahead of trends. The fashion retail industry is also facing competition from other industries for top talent with expertise in digital marketing, e-commerce, and data analytics.

Your Company continuously keeps abreast with leading employment practices in the industry placing strong focus on developing, motivating, and retaining the best talent for our existing as well as new ventures. Your Companys approach to talent retention and development is well- crafted and structured, complemented by targeted interventions that foster leadership growth within the Organization.

6. Quality and cost of retail space

Your Company operates via both online and offline channel. But at present, the majority of its sales come from the physical store network. With increased demand for retail space from apparel

and other industries like healthcare, education, jewellery etc. availability of quality retail space has become a challenge. Owing to huge demand and lesser availability of properties across key locations, rental costs have increased significantly as compared to pre-pandemic levels.

To address this issue, your Company continues to build relationship with most prominent mall owners and real estate developers across the country to remain a preferred partner of choice. Your Company is also committed to securing long-term leases to ensure continuity. In addition to that, your Company has implemented processes to enhance store appeal by investing in retail identity, renovating and rebranding, and improving customer navigation for an enhanced customer experience.

7. Execution Risk

Your Company has built meaningful presence in several high growth categories like Ethnic wear, Luxury, Innerwear and Athleisure and digital-first, in line with its portfolio strategy. These businesses currently are in expansion phase with significant investments being made in network expansion, brand building and organizational build-up. It is very important these initiatives achieve necessary scale and profitability, to help Your Company realise its overall long-term strategic goals.

Road Ahead

As per a large research house, Indias GDP is predicted to surpass USD 7.5 trillion by 2031, making it the third-largest economy globally. This economic expansion is expected to result in more than 2 times rise in per capita income by 2031, leading to a shift in consumer spending patterns from basic necessities to discretionary items. As a result, the demand for apparel products is likely to increase, presenting significant opportunities for the Indian apparel industry to grow and thrive in the coming years.

Your Company has already laid a solid foundation that enables it to take advantage of the future growth in the apparel industry. In previous years, your company adopted a portfolio-oriented strategy focused on offering a wide range of products across multiple segments, occasions, and price points, in response to shift towards branded products and changing consumer preferences.

Also, as part of its strategy, your Company has upgraded its digital capabilities, recognizing the importance of digital transformation in todays market landscape. By investing in its digital infrastructure, your Company is better equipped to cater to evolving customer needs, offer personalized and seamless experiences, and enhance its overall competitive position in the market.

The ongoing efforts of your Company exemplify a commitment to proactively adapt to the ever- evolving business landscape. This dedication sets a solid foundation for sustained achievements in the future. By combining these factors with an extensive portfolio of well-established brands, your company is positioned to seize opportunities for expansion and gain a stronger foothold in the industry, ensuring continued success.

Financial Performance and Analysis




Year Ended March 31, 2023 Year Ended March 31, 2022 Year Ended March 31, 2023 Year Ended March 31, 2022
Revenue from Operations 11,737 7,824 12,418 8,136
EBITDA (1) 1,705 1,174 1,617 1,203
Finance Costs 424 340 472 351
Depreciation 1,114 947 1,227 997
Profit / (Loss) Before Tax (1) 166 (113) (82) (145)
Current Tax (2) - 14 21
Deferred Tax Assets / (Liabilities) (36) 33 37 47
Net Profit / (Loss) After Tax (1) 133 (81) (59) (118)



Standalone (Comparable)*

Consolidated (Comparable)*

Year Ended March 31, 2023 Year Ended March 31, 2022 Year Ended March 31, 2023 Year Ended March 31, 2022
Revenue from Operations 11,737 7,824 12,418 8,136
EBITDA (1) 671 273 509 275
Finance Costs 160 132 172 134
Depreciation 262 215 304 235
Profit/ (Loss) Before Tax (1) 250 (74) 33 (94)
Current Tax (2) - 14 21
Deferred Tax Assets / (Liabilities) (36) 33 37 47
Net Profit/ (Loss) After Tax (1) 216 (41) 56 (67)

Standalone performance

Particulars As at March 31, 2023 As at March 31, 2022
Net Working Capital (2) 1,357 705
Net Fixed Assets (including cwip) 1,488 674
Deferred Tax Asset 317 353
Capital Employed 3,162 1,732
Investments (3) 1,401 835
Right-of-use assets 3,043 2,279
Goodwill (4) 1,860 1,860
Total Capital Employed 9,466 6,705
Net Worth 3,787 2,882
Debt 2,030 1,207
Lease Liabilities 3,649 2,616


(1) Includes other Income of 110 Crore (Previous year: 94 Crore).

(2) Net working Capital

Particulars As at March 31, 2023 As at March 31, 2022
Inventory 3,764 2,729
Trade Receivables 835 754
Cash and Bank Balances 643 108
Other Assets 2,123 2,009
Less: Trade Payables 3,663 3,336
Less: Other Liabilities 2,345 1,560
Net Working Capital 1,357 705

(3) Investments includes 1,391 Crore towards investments in Subsidiaries and Joint Venture (Previousyear: 828 Crore).

(4) /4s on March 31, 2023, goodwill (after testing for impairment in accordance with the Ind AS - 36 issued by the Institute of Chartered Accountants of India) stands at 1,860 Crore.


Your Company reported revenue of 11,737 Crore during the financial year, recording a growth of 50% over the previous year.

Earnings before interest, tax, depreciation and amortization ("ebitda")

EBITDA of the Company, including other income is 671 Crore on comparable basis (previous year EBITDA of 273 Crore). The reported EBITDA of the Company is 1,705 Crore (previous year 1,174 Crore) factoring impact of Ind AS 116. The EBITDA margin for the Company marginally decreased from 15.00% to 14.50% during the year.

Finance cost

Finance cost for the year was 160 Crore on a comparable basis, increased from 132 Crore in previous year, as a result of higher borrowings. The average borrowing cost for the Company remained flat to 7.66% as compared to 7.67% in the previous year due to higher proportion of

long-term borrowings. The reported finance cost of the Company is 424 Crore (previous year 340 Crore) due to the impact of Ind AS 116.


Depreciation increased from 215 Crore in the previous year to 262 Crore during the year on comparable basis. The reported depreciation of 1,114 Crore (previous year 947 Crore) includes the impact of Ind AS 116.


In view of accumulated losses of previous years, your directors have not recommended payment of any dividend for the year under review.


Borrowings have increased from 1,207 Crore in the previous year to 2,030 Crore with Net Debt increasing from 562 Crore in the previous year to 1,237 Crore. The Company has raised 1,269 Crore through fresh borrowings and have repaid borrowings of 447 Crore during the year with average borrowing cost at 7.66%.

The credit ratings of the Company by CRISIL Limited, ICRA Limited and India Ratings & Research during the year has improved to AA+ (Stable) [previous year aa (Stable)].

Non-Convertible Debentures ("NCDs")

During the year under review, the Company has issued and allotted 50,000 Listed, Unsecured, Rated, Redeemable NCDs of the face value of 1,00,000 (Rupees One Lakh only) aggregating to 500 Crore (Rupees Five Hundred Crore only) on Private Placement Basis, under Series 9.

The Company has repaid Series 6 NCDs of 500 Crore (Rupees Five Hundred Crore only) during the year. The details of outstanding NCDs as on March 31, 2023 are disclosed in the General Shareholder Information forming part of this Annual Report.

Standalone Key financial ratios

Particulars As at March 31, 2023 As at March 31, 2022
Debtors Turnover Ratio (times) (1) 14.77 11.55
Inventory Turnover Ratio (times) (1) 3.62 3.50
Interest Coverage Ratio (times) (1) 2.25 0.14
Current Ratio (times) 1.13 1.03
Debt Equity Ratio (times) 0.28 0.17
EBITDA Margin (%) 14.53 15.00
Operating Profit Margin (%) (1) 5.03 2.90
Net Profit Margin (%) (1) 1.13 -1.03
Return on Net Worth (%) (1) 3.97 -2.89
Return on Average Capital Employed (%) (1) 7.30 3.52

The formulae used in the computation of the above ratios are as follows:

Ratio Formula
Debtors Turnover Ratio Revenue from Operations/Average of opening and closing Trade Receivables
Inventory Turnover Ratio Revenue from Operations/Average of opening and closing Inventories
Interest Coverage Ratio Earnings Before Interest* and Tax/Finance Costs*
Current Ratio Current Assets/Current Liabilities (excluding Lease Liabilities accounted as per Ind AS 116)
Debt Equity Ratio Debt#/(Net Worth+ Lease Liabilities - Right of use)
EBITDA Margin EBITDA/Revenue from Operations
Operating Profit Margin Earnings Before Interest and Tax/Revenue from Operations
Net Profit Margin Profit After Tax/Revenue from Operations
Return on Net Worth Profit After Tax/Average net worth
Return on Average Capital Employed Earnings Before Interest and Tax/Average Capital Employed

*Finance cost/interest comprise of interest expense on borrowing and excludes interest on lease liabilities and interest charge on fair value of financial institution.

#Debt = Borrowings (excluding Lease Liabilities accounted as per IndAS 116) - Cash and Bank Balance (includes FD) - Liquid Investments.

Details of significant changes (i.e. change of 25% or more as compared to the immediately previous financial year) in the key financial ratios:

1. Debtors Turnover Ratio, Interest Coverage Ratio, Operating Profit Margin, Net Profit Margin, Return on Net Worth and Return on Average Capital Employed - Ratios have improved due to increased revenue and profitability.

Consolidated performance

At consolidated level, your Company reported a revenue of 12,418 Crore (previous year 8,136 Crore) and EBITDA of 1,617 Crore with EBITDA margin at 13.00% (previous year 1,203 Crore with EBITDA margin at 14.80%).


The audited financial statements of your Company for the year under review ("financial statements") are in conformity with the requirements of the Companies Act, 2013 read with the rules made thereunder ("Act") and the Accounting Standards. The financial statements reflect the form and substance of transactions carried out during the year under review and present your Companys financial condition and results of operations, fairly and reasonably.

Your Directors confirm that:

a) in the preparation of the annual accounts, the applicable accounting standards have been followed along with proper explanation relating to material departures, if any;

b) accounting policies selected have been applied consistently and reasonable & prudent judgements and estimates were made, so as to give a true and fair view of the state of affairs of your Company as at the end of the year under review and the profit of your Company for the year under review;

c) proper and sufficient care has been taken for the maintenance of adequate accounting records in accordance with the provisions of the Act, for safeguarding the assets of your Company and for preventing and detecting fraud and other irregularities;

d) the annual accounts of your Company have been prepared on a going concern basis;

e) adequate internal financial controls were laid down and followed by your Company and such internal financial controls were operating effectively;

f) proper systems have been devised by your Company to ensure compliance with the provisions of all applicable laws and such systems were adequate and operating effectively and

g) the Company has been in compliance with the applicable Secretarial Standards issued by the Institute of Company Secretaries of India.


a) Equity share capital

Details of changes in paid-up share capital during the year under review, are as under:

Paid-up Equity Share Capital in Crore
At the beginning of the year, i.e., as on April 1, 2022 938.29
Changes made during the year: Allotments made pursuant to:
1.1. Employee Stock Option Scheme, 2013 & 2017 0.27
1.2. Preferential Issue* 10.22
1.3. Rights Issue
(i) Receipt of final call money 0.01
(ii) Receipt of call money pursuant to annulment of forfeiture 0.02
(ii) Forfeiture due to non-payment of first and/or final call money (0.02)
At the end of the year, i.e., as on March 31, 2023 948.79

*During the year under review, the Company has received ~ 770 crore through preferential issue by way of:

i. 1,02,16,450 fully paid up Equity Shares (Face Value : 10 and Premium : 278.75 per share)

ii. 6,58,00,866 warrants, upon receipt of 25% of the Warrant Issue Price (i.e. 72.1875 per warrant) as warrant subscription money. Balance 75% of the Warrant Issue Price (i.e. 216.5625 per warrant) shall be payable within 18 months from the allotment date.

b) Preference share capital

The paid-up preference share capital of your Company as at the end of the year under review stood at 50.50 Lakh (same as at the end of previous year). The details of Preference shares are as below:

Class of preference shares Redemption date
5,00,000, 8% Redeemable Cumulative Preference Shares of 10/- each March 29, 2024
500, 6% Redeemable Cumulative Preference Shares of 100/- each October 12, 2024


("SEBI Listing Regulations")

A. Board of Directors ("Board")

(i) Number of meetings

The Board met 8 (eight) times during the year under review. The details of such meetings are disclosed in the Section The Board of Directors of the Corporate Governance Report forming part of this Annual Report.

(ii) Appointments and resignations

a) Appointments/Re-Appointments

(i) Mr. Ashish Dikshit, Managing Director (DIN: 01842066) was re-appointed for a further term of 5 (five) years w.e.f. February 1,2023. His re-appointment was approved by the Shareholders vide Postal Ballot on June 23, 2022.

(ii) Mr. Vikram Rao (DIN: 00017423) was re-designated as an Independent Director for a period of 5 (five) years w.e.f. May 18, 2022. His re-designation was approved by the Shareholders vide Postal Ballot on June 23, 2022.

(iii) Mr. Pankaj Sood, Non-Executive (Nominee) Director (DIN: 05185378) was appointed w.e.f. September 20, 2022 pursuant to the Share Subscription Agreement dated May 24, 2022 between the Company and Caladium Investments Pte. Ltd. His appointment was approved by the Shareholders vide Postal Ballot on October 20, 2022.

(iv) Ms. Ananyashree Birla, (DIN: 06625036) and Mr. Aryaman Vikram Birla (DIN: 08456879), Non-Executive Directors were appointed w.e.f. January 30, 2023. Their appointments were approved by the Shareholders vide Postal Ballot on March 28, 2023.

b) Resignations/Retirement by Rotation

(i) Mr. Himanshu Kapania, Non-Executive Director (DIN: 03387441) resigned w.e.f. closing hours ofJanuary 27, 2023, due to increased engagements across wide range of businesses and other pre-occupation.

The Board placed on record its sincere appreciation towards the valuable contribution made by Mr. Kapania during his tenure.

(ii) Further, in accordance with the provisions of the Act and the Articles of Association of the Company, Ms. Sangeeta Pendurkar, Whole-time Director (DIN: 03321646) and Mr. Vishak Kumar, Whole-time Director (DIN: 09078653), are due to retire by rotation at the ensuing Sixteenth Annual General Meeting and being eligible, have offered themselves for re-appointment.

Resolutions seeking their re-appointment alongwith their profiles as required under Regulation 36(3) of SEBI Listing Regulations form part of the Notice of Sixteenth Annual General Meeting.

(iii) Board evaluation

The Company has devised a framework for performance evaluation of Board, its committees and individual directors in terms of the provisions of the Act, SEBI Listing Regulations and the Nomination Policy of the Company.

During the year under review, the Board carried out the evaluation of its own performance and that of its committees and the individual directors. The performance evaluation of Non-Independent Directors and the Board as a whole was carried out by the Independent Directors.

The evaluation process consisted of structured questionnaires covering various aspects of the functioning of the Board and its committees, such as composition, experience and competencies, performance of specific duties and obligations, governance issues etc. The Board also carried out the evaluation of the performance of individual directors based on criteria such as contribution of the Director at the meetings, strategic perspective or inputs regarding the growth and performance of the Company etc.

Further, pursuant to the applicable provisions of the Act, the performance evaluation criteria for the Independent Directors is disclosed in the Section Directors Details as on March 31, 2023 of the Corporate Governance Report forming part of this Annual Report.

(iv) Declaration of independence

The Company has received necessary declaration from each Independent Director of the Company stating that:

(i) they meet the criteria of independence as provided in Section 149(6) of the Act and Regulation 16(1)(b) of the SEBI Listing Regulations ("said declarations").

(ii) they have registered their names in the Independent Directors Databank.

Based on the said declarations received from the Directors, the Board confirms, that the Independent Directors fulfill the conditions as specified under Schedule V of the SEBI Listing Regulations and are independent of the management.

B. Committees of the Board

The Board has constituted five committees, viz. Audit Committee, Corporate Social Responsibility Committee, Risk Management and Sustainability Committee, Nomination and Remuneration Committee and Stakeholders Relationship Committee and is authorised to constitute other functional Committees, from time to time, depending on business needs.

Details of all the committees, along with their charters, composition and meetings held during the year, are provided in the Section The Board Committees of the Corporate Governance Report forming part of this Annual Report.

C. Corporate Social Responsibility ("csr")

The Board has, pursuant to the recommendation of the CSR Committee, with a vision "to actively contribute to the social and economic development of the communities in which your Company

operates and in doing so, build a better, sustainable way of life for the weaker sections of society and raise the countrys human development index", adopted a CSR Policy and the same is available on the website of the Company i.e.

The scope of the CSR Policy is as under:

i. Planning Project or programmes which the Company plans to undertake falling within the purview of Schedule VII of the Act and

ii. Monitoring process of such project or programmes.

The CSR Policy of the Company inter alia includes the process to be implemented with respect to the identification of projects and philosophy of the Company, along with key endeavours and goals i.e.

• Education - to spark the desire for learning and knowledge;

• Health care - to render quality health care facilities to people living in the villages and elsewhere through our hospitals;

• Sustainable livelihood - to provide livelihood in a locally appropriate and environmentally sustainable manner;

• Infrastructure development - to set up essential services that form the foundation of sustainable development and

• Social cause - to bring about the social change we advocate and support.

CSR initiatives taken during the year

Your Companys CSR activities are mainly focused towards Education, Health and Sanitation, Water, Digitisation, Sustainable livelihood, Institutional Building and Social Causes.

An annual report on CSR activities of the Company for the financial year 2022-23 is annexed as Annexure I to this Report.

D. Key Managerial Personnel ("kmp")

During the year under review, Ms. Geetika Anand, Company Secretary and Compliance Officer resigned w.e.f. closing hours of November 30, 2022, in order to pursue other opportunities within the Aditya Birla Group. Mr. Anil Malik was appointed as the Company Secretary and Compliance Officer w.e.f. December 1, 2022.

Pursuant to Section 203 of the Act, the KMPs of the Company as on March 31, 2023 are:

i. Mr. Ashish Dikshit, Managing Director;

ii. Ms. Sangeeta Pendurkar, Whole-time Director;

iii. Mr. Vishak Kumar, Whole-time Director;

iv. Mr. Jagdish Bajaj, Chief Financial Officer and

v. Mr. Anil Malik, Company Secretary and Compliance Officer.

E. Remuneration of Directors and Employees

Disclosure comprising particulars with respect to the remuneration of Directors and employees, as required to be disclosed in terms of the provisions of Section 197(12) of the Act and Rule 5(1) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, is annexed as Annexure II to this Report.

The statement containing names of top ten employees in terms of remuneration drawn and the particulars of employees as required under Section 197(12) of the Act read with Rule 5(2) and 5(3) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, is provided in a separate annexure forming part of this report. Further, the report and the accounts are being sent to the Members excluding the aforesaid annexure. In terms of Section 136 of the Act, the said annexure is open for inspection and any Member interested in obtaining a copy of the same may write to the Company Secretary.

F. Employee Stock Option Scheme and Share Based Employee Benefits

Grant of share-based benefits to employees is a mechanism to align the interest of the employees with those of the Company, to provide them with an opportunity to share the growth of the Company and also to foster long-term commitment.

Employee Stock Option Scheme and Restricted Stock Units

Your Company regards employee stock options as instruments that would enable the employees to share the value they create for the Company in the years to come. Accordingly, in terms of the provisions of applicable laws and pursuant to the approval of the Board and the members of the Company, the Nomination and Remuneration Committee ("nrc") has duly implemented the:

(a) Employee Stock Option Scheme - 2013 ("Scheme 2013");

(b) Aditya Birla Fashion and Retail Limited Employee Stock Option Scheme 2017 ("Scheme 2017") and

(c) Aditya Birla Fashion and Retail Limited Employee Stock Option Scheme 2019 ("Scheme 2019"), to grant the stock options, in the form of Options and Restricted Stock Units ("RSUs"), to the employees of the Company.

All the Schemes of the Company i.e. Scheme 2013, Scheme 2017 and Scheme 2019 are governed by the Securities and Exchange Board of India (Share Based Employee Benefits and Sweat Equity) Regulations, 2021 ("sebi sbeb & se Regulations") and in terms of the approvals granted by the shareholders of the Company, the NRC inter alia administers, implements and monitors the aforesaid schemes, thereby governing the grant of share based benefits to its employees, in the form of RSUs.

A certificate from the Secretarial Auditor of the Company, confirming that the aforesaid schemes have been implemented in accordance with the SEBI SBEB & SE Regulations and will be open for inspection at the ensuing Annual General Meeting.

Stock Appreciation Rights

Your Company has also instituted a Plan for Stock Appreciation Rights Plan, 2013 ("sar Plan 2013") in the year 2013 and Aditya Birla Fashion and Retail Limited Stock Appreciation Rights Scheme 2019 ("sar Scheme 2019") in the year 2019.

The SAR Plan 2013 and SAR Scheme 2019, do not give rise to any right towards any equity share of the Company and hence, they are not covered under the provisions of SEBI SBEB & SE Regulations. On exercise of the SARs granted under the said plan/scheme, the employee exercising the SARs becomes entitled to receive cash, in terms of the respective plan/scheme.

In terms of of the provisions of Regulation 14 and Part F of Schedule I of the SEBI SBEB & SE Regulations, details of the aforesaid schemes is available on the website of the Company i.e.

G. Related Party Transactions ("RPTs")

All RPTs entered into during the year under review were approved by the Audit Committee, from time to time and the same are disclosed in the financial statements of your Company for the year under review. Further, pursuant to the provisions of the Act and the SEBI Listing Regulations, the Board has, on recommendation of its Audit Committee, adopted a Policy on RPT and the said policy is available on the website of the Company i.e.

Further, in terms of the provisions of Section 188(1) of the Act read with the Companies (Meetings of Board and its Powers) Rules, 2014 and Regulation 23 of the SEBI Listing Regulations, all contracts/arrangements/transactions entered into by the Company with its related parties, during the year under review, were:

• in "ordinary course of business" of the Company;

• on "an arms length basis" and

• not "material".

All transactions with related parties are in accordance with the policy on RPT formulated by the Company.

Accordingly, Form No. AOC-2, prescribed under the provisions of Section 134(3)(h) of the Act and Rule 8 of the Companies (Accounts) Rules, 2014, for disclosure of details of RPT, which are "not at arms length basis" and also which are "material and at arms length basis", is not applicable and hence does not form part of this Report.

H. Dividend Distribution Policy

In terms of Regulation 43A of the SEBI Listing Regulations, your Company has formulated a Dividend Distribution Policy, with an objective to provide the dividend distribution framework to the Stakeholders of the Company. The policy sets out various internal and external factors, which shall be considered by the Board in determining the dividend pay-out. The policy is annexed as Annexure III to this Report and is also available on the website of the Company i.e.

I. Strategic Initiatives during the year

a) Preferential Issue:

During the year under review, the Company has raised capital by way of a Preferential Issue as detailed below:

Event date Details
May 24, 2022 Approved issuance of Equity shares and Warrants on a preferential basis to Caladium Investment Pte. Ltd ("Caladium") aggregating to 2,195 Crore.
Jun 23, 2022 Received approval of shareholders by way of Postal Ballot.
Aug 30, 2022 Caladium received approval of Competition Commission of India for its proposed acquisition in your Company.
Sep 20, 2022 • Approved allotment of:
(a) 1,02,16,450 Equity Shares of face value of 10 each at a per share price of 288.75 fully paid-up, which inter alia includes a share premium of 278.75 aggregating to 294.99 Crore.
(b) 6,58,00,866 Warrants at a per share price of 288.75 per warrant, each warrant being convertible into or exchangeable for 1 equity share of the Company of face value of 10/- each, aggregating to 475.00 Crore which is 25% of the total consideration payable for the Warrants as on the date of allotment (the remaining 75% payable on conversion).
• Post allotment of Equity Shares, Caladium holds 1.08% equity stake in the Company.

b) Acquisition of stake in brand "Masaba"

The Company has acquired 52.44% stake in Brand Masaba in May, 2022 by signing of definitive agreements thereby making it a subsidiary of the Company.

c) Strategic partnership with "Reebok":

On December 14, 2021, the Board approved acquiring exclusive online and offline rights to the global brand Reebok for the Indian market and other ASEAN countries and purchase of certain assets of Reebok India Company including inventory by way of entering into a Licensing Agreement and a Purchase Agreement, respectively. As part of the transfer of global ownership of Reebok, various agreements have been signed between the Authentic Brand Group, US and Adidas. Upon signing of definitive agreement(s) and necessary approvals, aforesaid assets relating to Reebok has been transferred to the Company effective from October 1, 2022.

d) TMRW: A portfolio of digital-first brands

The Company on April 11 2022, incorporated its new House of Brands entity, Aditya Birla Digital Fashion Ventures Limited to build a portfolio of digital first brands in the fashion & lifestyle space. The Company invested 315.5 Crore during the year under review in the entity for acquisitions and the operational activities associated with the acquired brands.

J. Proceeds from Rights Issue, Preferential Issue and Non-Convertible Debentures:

The utilization of funds raised have been mentioned hereunder:

Mode Object Amount allocated Amount utilized
Rights Issue Repayment of certain borrowings of the Company 745.00 745.00
General corporate purpose 244.26 242.49
Preferential Issue Strengthening the balance sheet, pursue growth in existing business, expand new lines of business, strengthen digital and omni-channel 770.00 770.00
Non-Convertible Debentures Refinancing of existing debt and General corporate purpose 500.00 500.00

There has been no deviation in the use of proceeds of the Rights Issue, Preferential Issue and NCDs ("aforesaid Issues") from the objects stated in the respective Offer documents as per Regulation 32 of SEBI Listing Regulations. The Company has been disclosing on a quarterly basis to the Audit Committee, the uses/application of proceeds/funds raised from the aforesaid Issues and also filed with the Stock Exchanges on a quarterly basis, as applicable.

K. Subsidiaries, Joint Ventures, Associate Companies

As on March 31,2023, the Company has 14 (fourteen) subsidiaries and 1 (one) associate company.

During the year under review, following Companies became subsidiaries of the Company. However, the Company did not become a part of any joint venture during the year.

Sr. No. Name of the Company Relationship Date of becoming subsidiary
1. Aditya Birla Digital Fashion Ventures Limited Wholly owned April 11, 2022
2. Aditya Birla Garments Limited subsidiary June 15, 2022
3. House of Masaba Lifestyle Private Limited Subsidiary June 1, 2022
4. Pratyaya E-Commerce Private Limited Step down July 22, 2022
5. Imperial Online Services Private Limited subsidiary August 12, 2022
6. Awesomefab Shopping Private Limited August 24, 2022
7. Bewakoof Brands Private Limited February 15, 2023
8. Next Tree Products Private Limited

Pursuant to the provisions of Section 129(3) of the Act, read with the Companies (Accounts) Rules, 2014 and in accordance with applicable accounting standards, a statement containing the salient features of financial statements of your Companys subsidiaries and associate in Form No. AOC-1 is annexed as Annexure IV to this Report.

In accordance with the provisions of Section 136 of the Act and the amendments thereto and the SEBI Listing Regulations, the audited financial statements, including the consolidated financial statements and related information of the Company and financial statements of your Companys subsidiaries, joint ventures/associate companies have been placed on the website of your Company viz.

Your Company has formulated a Policy for determining Material Subsidiaries. The said policy is available on the website of the Company i.e. However, the Company does not have any material subsidiary as defined under Regulation 16(1 )(c) of the SEBI Listing Regulations.

L. Conservation of Energy, Technology Absorption, Foreign Exchange Earnings and Outgo

Your Company consciously makes all efforts to conserve energy across all its operations. A report containing details with respect to conservation of energy, technology absorption and foreign exchange earnings and outgo, required to be disclosed in terms of Section 134(3)(m) of the Act read with the Companies (Accounts) Rules, 2014, is annexed as Annexure V to this Report.

M. Vigil Mechanism

The Board, on recommendation of its Audit Committee, has adopted a Vigil Mechanism/Whistle Blower Policy and the details of which are provided in the Corporate Governance Report forming part of this Annual Report.

Adequate safeguards are provided against victimization to those who avail the mechanism and direct access to the Chairperson of the Audit Committee is provided to them. The details of establishment of Vigil Mechanism is also available on the website of the Company


N. Risk Management

Your Company has framed and implemented a Risk Management Policy in terms of the provisions of Regulation 21 of the SEBI Listing Regulations, for the assessment and minimization of risk, including identification therein of elements of risk, if any, which may threaten the existence of the Company.

The policy is reviewed periodically by the Risk Management and Sustainability Committee along with the key risks and related mitigation plans. More details on risks and threats have been disclosed hereinabove, as part of the Management Discussion and Analysis.

Further, in view of the ever-increasing size and complexity of the business operations, your Company is exposed to various risks emanating from frauds. Accordingly, the Board, on recommendation of the Audit Committee, has adopted an Anti-Fraud Policy and a Whistle Blower Policy, to put in place, a system for detecting and/or preventing and/or deterring and/ or controlling the occurrence of frauds.

O. Nomination Policy and Executive Remuneration Policy/Philosophy

In terms of Section 178 of the Act and Regulation 19 of the SEBI Listing Regulations, the Board of your Company, on recommendation of the NRC, had adopted a Nomination Policy, which inter alia

enumerates the Companys policy on appointment of directors, KMPs and senior management. Further, the Board, on recommendation of NRC, had also adopted a policy entailing Executive Remuneration Philosophy, which covers remuneration philosophy covering the directors, KMPs, senior management and other employees of the Company.

Both the aforesaid policies, as amended from time to time pursuant to the amendments in the applicable regulatory provisions, are available on the website of the Company i.e.

Salient features of the aforesaid policies are as under:

(a) Nomination Policy

The Nomination Policy is enacted mainly to deal with the following matters, falling within the scope of the NRC to:

• institute processes which enable the identification of individuals who are qualified to become Directors and who may be appointed as key managerial personnel and/or in senior management and recommend to the Board of Directors their appointment and removal from time to time;

• devise a policy on board diversity;

• review and implement the succession and development plans for managing director, executive directors and officers forming part of senior management;

• formulate the criteria for determining qualifications, positive attributes and independence of directors;

• establish evaluation criteria of Board, its committees and each director and

• recommend the Board, all remuneration, in whatever form, payable to senior management.

(b) Executive Remuneration Policy/Philosophy

This Policy supports the design of programmes that align executive rewards - including incentive programmes, retirement benefit programmes, promotion and advancement opportunities - with the long-term success of the Stakeholders of the Company.

The executive remuneration program of the Company is designed to attract, retain, and reward talented executives who will contribute to our long-term success and thereby build value for our shareholders and intends to:

• provide for monetary and non-monetary remuneration elements to our executives on a holistic basis and

• emphasize "Pay for Performance" by aligning incentives with business strategies to reward executives who achieve or exceed Group, business and individual goals.

P. Business Responsibility and Sustainability Report

Your Companys sustainability initiatives are aligned with the Aditya Birla Groups sustainability vision, which mainly comprises of responsible stewardship, stakeholder engagement and future-proofing. Accordingly, under the aegis of the Aditya Birla Groups sustainability vision, your Company is strengthening its ReEarth programme, to design a roadmap, which will align with the group level sustainability policies and international frameworks.

Through this mission, we hope to create a future ready organisation, which can pre-empt imminent challenges and address the needs of all stakeholders.

In accordance with our sustainability vision and in terms of Regulation 34(2)(f) of the SEBI Listing Regulations, a Business Responsibility and Sustainability Report forms part of this Report.

Q. Auditors and Auditors Report

(i) Statutory Auditor

Price Waterhouse & Co Chartered Accountants LLP (FRN: 304026E/E-300009), were appointed as the Statutory Auditors of the Company at the 14th Annual General Meeting ("agm"), for a term of five consecutive years, till the conclusion of the 19th AGM to be held in the year 2026.

Further, the Auditors Report "with an unmodified opinion", given by the Statutory Auditors on the financial statements of the Company for financial year 2022-23, forms part of this Annual Report. There has been no qualification, reservation, adverse remark or disclaimer given by the Statutory Auditors in their Report for the year under review.

The notes to the financial statements are self-explanatory and do not call for any further comments.

(ii) Secretarial Auditor

Pursuant to the provisions of Section 204 of the Act, M/s. Dilip Bharadiya & Associates, Company Secretaries (FRN: P2005MH091600), were appointed as the Secretarial Auditor of the Company, to conduct secretarial audit for the year under review.

The Secretarial Audit Report given by the Secretarial Auditor of the Company is annexed as Annexure VI to this Report. There has been no qualification, reservation, adverse remark or disclaimer given by the Secretarial Auditor in his Report for the year under review.

(iii) Cost Auditor

During the year under review, your Company was not required to maintain cost records under Section 148(1) of the Act. Hence, the provisions related to appointment of Cost Auditor is not applicable.

Further, no fraud in terms of the provisions of Section 143(12) of the Act, has been reported by the Auditors in their reports for the year under review.

R. Material changes and commitment affecting financial position of the Company which have occurred between the end of the Financial year, to which the financial statement relates, and the date of the Report

On May 5, 2023, the Board of Directors approved the acquisition of TCNS Clothing Co. Ltd. The acquisition is subject to approval of the Competition Commission of India, SEBI and other regulatory approvals and is planned to be achieved in the following manner:

(a) acquisition of between 1,41,92,448 to 1,98,76,757 equity shares of TCNS Clothing Co. Ltd ("Target Company"), representing between ~22.0% and ~30.81% of the Expanded Share Capital of the Target Company, as defined in the Public Announcement from the promoters of the Target Company for a consideration of 503 per equity share (subject to closing adjustments);

(b) making an open offer for up to 1,87,08,227 equity shares, constituting 29.0% of the Expanded Share Capital, at a price of 503 per equity share from the public shareholders of the Target Company, conditional upon a minimum level of acceptance of 1,30,23,918 equity shares, constituting ~20.19% of the Expanded Share Capital ("Minimum Level of Acceptance") and

(c) subsequent to completion of steps (a) and (b), amalgamation of the Target Company (as a going concern) with the Company under the Companies Act, 2013 read with relevant circulars and regulations of Securities and Exchange Board of India, and other applicable laws. Equity shares of the Company will be issued to the shareholders of the Target Company (other than the Company) in the ratio of 11 fully paid up equity shares of 10 each of the Company for every 6 fully paid-up equity shares of 2 of the Target Company ("Share Exchange Ratio"). The effectiveness of the Scheme will be subject to inter alia the approval of Competition Commission of India, National Company Law Tribunals and completion of the acquisition and filing of the approved schemes with the Registrar of Companies.

S. Other Disclosures

In terms of the applicable provisions of the Act and SEBI Listing Regulations, your Company additionally discloses that, during the year under review:

• there was no change in the nature of business of your Company;

• it has not accepted any fixed deposits from the public falling under Section 73 of the Act read with the Companies (Acceptance of Deposits) Rules, 2014. Thus, as on March 31,2023, there were no deposits which were unpaid or unclaimed and due for repayment, hence, there has been no default in repayment of deposits or payment of interest thereon;

• it has not issued any shares with differential voting rights;

• it has not issued any sweat equity shares;

• no significant or material orders were passed by the regulators or courts or tribunals which impact the going concern status operations of your Company in future;

• it has not transferred any amount to the Reserves;

• it has not raised any funds through qualified institutions placement as per Regulation 32(7A) of SEBI Listing Regulations;

• it does not engage in commodity hedging activities;

• it has not made application or no proceeding is pending under the Insolvency and Bankruptcy Code, 2016 and

• it has not made any one-time settlement for the loans taken from the Banks or Financial Institutions.

It is further disclosed that:

• there is no plan to revise the financial statements or directors report in respect of any previous financial year;

• particulars of the loans, guarantees and investments as required under Section 186 of the Act are disclosed in the financial statements of your Company for the year under review and

• details pertaining to unclaimed shares demat suspense account of your Company are disclosed in the Shareholders Information forming part of this Annual Report.


Your Company is committed to maintain the highest standards of Corporate Governance and adheres to the Corporate Governance requirements set out by the SEBI. The report on Corporate Governance as stipulated under the SEBI Listing Regulations forms part of this Annual Report.

Your Company has duly complied with the Corporate Governance requirements as set out under Chapter IV of the SEBI Listing Regulations and M/s. Dilip Bharadiya & Associates, Company Secretaries, vide their certificate dated May 22, 2023, have confirmed that the Company is and has been compliant with the conditions stipulated in the Chapter IV of the SEBI Listing Regulations. The said certificate is annexed as Annexure VII to this Report.


Pursuant to the provisions of Sections 92(3) and 134(3)(a) of the Act and the Companies (Management and Administration) Rules, 2014, the Annual Return in Form no. MGT-7 is available on the website of the Company i.e.


Your Company has put in place adequate internal control systems that are commensurate with the size of its operations. Internal Control system comprise of policies and procedures are designed to ensure sound management of your Companys operations, safekeeping of its assets, optimal utilisation of resources, reliability of its financial information, and compliance.


Your Company has in place a policy on Prevention of Sexual Harassment at Workplace, which is in line with requirements of the Sexual Harassment of Women at Workplace (Prevention, Prohibition

and Redressal) Act, 2013 ("posh Act"). The objective of this policy is to provide an effective complaint redressal mechanism if there is an occurrence of sexual harassment.

This policy is applicable to all employees, irrespective of their level and it also includes Third Party Harassment cases i.e. where sexual harassment is committed by any person who is not an employee of the Company.

Your Company has also set up an Internal Complaints Committee at each of its administrative office(s) which is duly constituted in compliance with the provisions of the POSH Act. Further, the Company also conducts interactive sessions for all the employees, to build awareness amongst employees about the policy and the provisions of POSH Act.

During the year under review, the Committee has received 30 complaints, out of which 29 complaints were resolved with appropriate action and 1 complaint was pending at the end of the year.


Your Company has been a proud recipient of many awards and recognitions during the year under review and significant ones amongst them are as under:

• "Most Admired Retail Group of the year" at MAPIC India Retail & Tech Awards Sep 2022;

• "Best In-House Magazine Award" for InTouch newsletter at the Silver Feather Awards 2022;

• Silver in the "House Journal (Print)" category for InTouch newsletter at the Public Relations Council of India (PRCI) Excellence Awards 2022 (12th edition);

• "Best Loyalty Program in Retail Sector - Single Format" by Louis Philippe at the Customer Fest Awards 2022 (16th edition);

• "Most Admired Retailer of the Year" for "Kidswear: Allen Solly Juniors" by Allen Solly at MAPIC India Retail & Tech Awards Sep 2022;

• Pantaloons won "Champion of Champions" (Loyalty Program of the Year), "Rewards Program", "Best Loyalty Program", "Best Use of Contest/Promotion in a Loyalty Program" and "Best Integrated Media Loyalty Campaign" at The Customer Fest Awards 2022;

• Pantaloons won - Gold for Sheros and Silver for Creative Excellence in Advertising in the Fashion, Jewellery & Lifestyle category at Exchange4Media PrimeTime Awards 2022;

• Diamond in the "Internal Communication Campaign" category at the 12th Public Relations Council of India (PRCI) Excellence Awards 2022;

• ESG India Leadership Awards 2022 in "Best Green Supply Chain" category by ESGRisk, Acuity Knowledge Partners;

• "ESG Trailblazers" at the ESG World Summit and GRIT Awards 2022;

• Madura Clothing won 8 Golds for its "Kaizen & Poka yoke concepts" at the Quality Circle Forum of India (QCFI) in 2022-23 and

• Haritha Apparels Limited and Crafted Clothing Limited won Gold for "India Green Manufacturing Challenge (IGMC)" 2022-23.


We take this opportunity to thank all the customers, members, investors, vendors, suppliers, business associates, bankers and financial institutions for their continuous support. We also thank the Central and State Governments and other regulatory authorities for their co-operation.

We acknowledge the patronage of the Aditya Birla Group and above all, we place on record our sincere appreciation for the hard-work, solidarity and contribution of each and every employee of the Company in driving the growth of the Company.

For and on behalf of the Board of Directors
Ashish Dikshit Sangeeta Pendurkar
Place : Mumbai Managing Director Whole-time Director
Date : May 22, 2023 DIN:01842066 DIN:03321646