Manyavar - Connecting To The Roots With Style: Motilal Oswal Initiates Coverage

Motilal Oswal Report

Manyavar Owner Vedant Fashions Ltd., with a pan-India presence covering 250 cities and 640 stores, has established itself as a strong brand within the highly underpenetrated and unorganised ethnic wear segment (~20% branded). Limited competition, growing cultural pull and strong brand recall present a huge runway of growth for Vedant Fashions.

The company’s: 1. strong design capabilities with data-driven decision making (leading to no discounted sales), 2. tech-driven supply chain and auto replenishment model 3. exclusive vendor ecosystem, and 4. franchisebased exclusive brand outlet expansion have helped scale up its business and achieve superior margins.

Scaling-up emerging brands (especially Mohey; ~10% of revenue), and catering to the sizeable women’s celebration wear market (~five times the size of men’s segment at Rs 735 billion as of FY20), can be the key growth levers with improving operating metrics and plans to add independent stores.

Further, expanding 1. Twamev through up-selling and 2. Manthan to capture the fashion segment could underpin revenue growth moving ahead.

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