Global Market
The financial year 2023 was marked by a complex global economic landscape, as multiple
factors posed significant challenges. The ongoing COVID-19 pandemic and its emerging
variants, geopolitical tensions exemplified by the Russia-Ukraine conflict entering its
second year, and energy crisis that affected Europe and beyond, had far-reaching
consequences. As a result, inflation rates soared in various economies, prompting central
banks to implement aggressive monetary policies to combat inflation.
With the macroeconomic insights in mind. the global apparel market also encountered its
share of turbulence during the FY 2022-23. Amid inflation. geopolitical tensions, and a
resurgence of COVI D-19 cases in China. the global GDP recorded a growth rate of 3.5
percent. which was lower than the previous years 6.3 percent. Notably, advanced economies
witnessed their highest inflation rates since 1982. while emerging markets and developing
economies experienced significant inflation not seen since 1999.
Central banks worldwide responded to inflationary pressures by raising policy interest
rates, contributing to a temporary contraction in GDP during Q2. However. the global
economy regained momentum in the second half of the fiscal year, bolstered by lower
commodity prices. strong labor markets, robust household consumption, and increased
business investments. Chinas re-opening in November 2022 also contributed to the overall
global economic rebound.
Looking ahead. the global economic outlook for 2023 remained uncertain, with
projections indicating mixed trajectories for growth rates and inflation. In this dynamic
landscape, the apparel industry faces the challenge of adapting to changing consumer
behaviors and demands to navigate the complexities of the global economy successfully.
Overview of the World Economic Outlook Projections (%)
| Particulars |
2022 |
2023 |
2024 |
| World Output |
3.5 |
3.0 |
3.0 |
| Advanced Economies |
2.7 |
1.5 |
1.4 |
| Emerging Market and Developing Economies |
4.0 |
4.0 |
4.1 |
| Emerging and Developing Asia |
4.5 |
5.3 |
5.0 |
| China |
3.0 |
5.2 |
4.5 |
| India |
7.2 |
6.1 |
6.3 |
Source: IMF World Economic Outlook July 2023
Indian economy overview
The data release at February 2023 end from the National Statistical Office (NSO)
highlights that the Indian economy is positioned favourably compared to market
expectations. Indias recovery from the pandemic has been stronger than initially
anticipated, gaining momentum steadily since the second quarter of the fisca l year 2023.
The International Monetary Fund (IMF) identified India as one of the top two fast-growing
economies in 2022. Despite global challenges and tighter domestic monetary policies,
Indias economy achieved a growth rate of 7.0%, indicating its inherent economic
resilience and ability to rejuvenate growth drivers of the economy.
For 2023-24, Indias GDP is projected to grow by 6-6.8%, overcoming challenges like
inflation and supply shocks. The governments efforts to manage supply and demand,
infrastructure investments, and pro-investor policies are expected to stimulate growth.
The manufacturing and services sectors are poised for recovery, driven by improved
consumer and business confidence. Recent improvements in the private sectors financial
health suggest potential increased spending and capital investment when the investment
cycle picks up. The Reserve Bank of India (RBI) has projected headline inflation to stand
at 5.4 percent in FY24.
Positive signs are evident in the labour market, with rising workforce participation
and job creation in specific sectors. The "Atmanirbhar Bharat" (self-rel iant
India) initiative is supported by measures like the Emergency Credit Line Guarantee Scheme
and the Production Linked Incentive Scheme, aimed at reducing import dependence and
strengthening the manufacturing sector. Structural reforms such as the National
Infrastructure Pipeline and National Monetization Plan are set to bolster infrastructure
development and drive progress across sectors.
Indias economic fundamentals remain robust, and the long-term outlook is expected to
be minimally impacted. The subdued global growth scenario has potential benefits for
India, including lower oil prices and a comparatively better current account balance
projection. While uncertainties persist, the overall external situation is anticipated to
remain manageable for India.
Source: -
RBI March 2023 Bulletin https:I /pib.gov.in/PressReleasePage.aspx7PR/0=1894932 Economic
Swveyoflndia. 2022-2023
Indian Retail overview
Indian Apparel and Retail Market Highlights
The Indian textile an d apparel market is thriving due to increased demand for
high-quality clothing and footwear. The government supports domestic manufacturers through
initiatives like production-linked incentives. Abundant raw materials like cotton. wool.
and silk are readily available. Sustainable practices. such as using vegan leather and
eco-friendly materials, are adopted by key players to prevent animal cruelty and reduce
pollution. Luxury brands use silks and leather for durable products. Online platforms and
e-commerce are expanding distribution. Growing awareness of environmental issues drives
demand for long-lasting, environmentally-friendly fashion. The Indian apparel industry
stands out globally due to its rich heritage of ancient techniques and cultural diversity.
Across Indias vast expanse, diverse regions not only possess distinct languages and
cultures but also showcase a variety of clothing styles. As urbanization accelerates and
traditional values persist. the fashion and apparel sectors are undergoing a process of
transformation to align with evolving trends.
Apparel Market: The Indian apparel market has witnessed significant growth. with a
revenue of US$96.47 billion in 2023. The market is projected to expand at a compound
annual growth rate (CAGR) of 3.34% from 2023 to 2027. The largest segment with in the
apparel market is Womens Apparel, with a substantial market volume of US$43.65 billion in
2023.
Retail Growth: The India n retail market is on a trajectory to reach an impressive
value of $2 trillion by 2032. This growth is fueled by various factors. including
urbanization, rising incomes, and the prevalence of nuclear families.
E-commerce Industry: The Indian e-commerce sector is experiencing rapid expansion.
poised to surpass the $350 billion mark by 2030. The industry is projected to grow at an
impressive CAGR of 23%. In 2021, the Gross
Merchandise Value (GMV) of the Indian e-commerce market exceeded $55 billion. By 2030.
the annual GMV is estimated to reach $350 billion.
Investment and Funding: E-commerce and consumer internet companies in India
attracted significant investor interest, raising a substantial US$1 S.4 billion in private
equity and venture capital funding in 2022. This represents a notable increase from the
approximately US$8.2 billion raised in 2020.
Online Retail Ranking: By 2030. India is expected to secure its position as the
third-largest online retail market globally. boasting an estimated annual GMV of $350
billion. This impressive growth solidifies Indias prominence in the digital retail
landscape. Recent industry reports highlight a remarkable 36.8% year-on-year growth in the
e-commerce sectors order volumes. This significant increase reflects the shifting
consumer preference for year-round online shopping, indicating the advanced and mature
status of e-commerce brands in India
These statistics highlight the remarkable growth and potential of the Indian apparel
and retail sectors. As the apparel market continues to thrive, and the retail and
e-commerce industries demonstrate robust expansion, India is poised to play a significant
role on the global stage, The confluence of urbanization, rising income levels, and
technological advancements positions India as a key player in shaping the future of the
retail and e-commerce landscape.
Source
Apparel - India I Statista Market Forecast
Retail Industry in India - Indian Retail Sector. Market Size (investindia.gov.in)
https://www.ibeforglindustry/retail-india
Trends in Indian fashion industry
As new trends emerge in the Indian fashion industry. AFL is ready and equipped to
leverage these trends by
servicing the new priorities and demands of our customers.
| Digital - Channel of choice |
Footwear potential |
| Anticipated to surpass $350 billion in GMV by 2030. the Indian e-commerce sector
presents a substantial avenue for local fashion brands. The pandemic expedited the
industrys digital transformation. prompting Indian brands to prioritize on line presence
through e-commerce platforms. Social media proves pivotal for marketing and engagement.
Forecasts project India to ascend as the third-largest online retail market by 2030 |
As the consumer preference & market shifts towards a bold &
fashionable & casualisation approach. the team is ready to leverage this shift with a
stronger design language, without losing the roots of classic. The collection caters to
all. from latest generational shift of fashionable Gen-Z to the ones who still prefer
classic styling. With its unique design languages & strive for innovation along with
stronger portfolio of brands. AFL will be one of the growing footwear business in the
Indian footwear industry. |
| AFL is a leading Omnichannel player with own e-commerce website & strategic
partnerships with third-party marketplaces |
With a diverse product range, across different brands, AFL is ready
to cater to a wider spectrum of consumers & capture a larger segment of the market |
| Local sourcing and manufacturing |
Formal wear reinvented |
| The surge in valuing local sourcing and production continues its upward trajectory
into 2023. Brands and retailers are wholeheartedly embracing this trend. actively seeking
local materials and crafting garments within their communities. This not only champions
reduced emissions and community empowerment but also affords a heightened level of control
over the manufacturing process. ensuring improved working conditions - a paramount concern
for conscientious consumers. |
The approach to dressing for work. weddings. and events has shifted. reshaping formal
wear. While relaxed dress codes are common. the integration of stretchable clothing into
formal attire is notable. The rising popularity of stretchable garments spans all product
categories. lending versatility. Designers now incorporate stretch fabrics. fostering
creativity in formal fashion with unique and innovative styles. |
| AFL stands to benefit from technological innovations in the manufacturing space and
drive localization to improve profitability |
AFL is well-positioned as the leading Formal wear player in India |
Source www.indianretailer.com
Retail Industry in India - Indian Retail Sector. Market Size (investindia.gov.in)
Arvind Fashions Limited
At the forefront of the fashion and lifestyle landscape, your Company leads with a
diverse portfolio of brands that epitomize innovation, quality, and customer-centricity.
From USPAs sporty offerings to Tommy Hilflgers timeless elegance, each brand caters to
dynamic consumer preferences. Our category expansions include comfort wear, athleisure,
prestige beauty, premium kidswear, innerwear, footwear & accessories. Advanced
analytics enhance efficiency and merchandise curation for digital customers, aligning with
our focus on direct-to-consumer capabilities. With a commitment to heritage, innovation
and customer satisfaction, Arvind Fashions Ltd. shapes the global fashion landscape,
delivering unrivalled experiences.
Key characteristics of the Arvind Fashions portfolio
• Lifestyle offering across International and aspirational brands
• Across price points & usage occasions to cater to large consumer segments
• Distribution strength to expand into multiple cities & towns across India
• Future ready by being digita lly capable with presence across all
direct-to-consumer touch points: own website, strong market place & very large
e-commerce partner portal play
• Strong brand extensions into adjacent categories post success of footwear,
innerwear, kids wear and accessories across brand portfolios
| U.S. Polo Assn. |
#1 Casuals brand |
| Flying Machine |
Among top 3 Denim brands |
| Arrow |
Among top 3 Formalwear brands |
| Tommy Hilfiger |
#1 & #2 in super premium casuals |
| Calvin Klein |
|
| Sephora |
#1 Prestige beauty retailer |
+91-9892691696
