21 June 2023, Mumbai
ICRA, the prominent credit rating agency, has published a report highlighting the challenges faced by Indian fashion retail entities.
Indian Fashion Retail in FY 2024
The analysis, covering 11 listed retail companies, reveals that demand pressures and inflationary headwinds are likely to moderate revenue growth to 10% in the fiscal year 2024. Amidst Inflationary Pressure
Despite an impressive 51% year-on-year revenue growth in FY 2023, the fashion retail industry is projected to experience a slowdown due to inflationary pressures. ICRA's report also indicates a decline in operating profit margins (OPMs) by approximately 100 basis points, primarily attributed to softening demand and continued high expenditure on advertising and promotion.
Revenue Growth
However, ICRA maintains a stable outlook on the retail sector. Ms. Sakshi Suneja, Vice President & Sector Head - Corporate Ratings at ICRA, comments on the trends and expects the sector to improve with the onset of the festive season, translating into an estimated 10% revenue growth for FY 2024.
