Lalit Agarwal, Founder & MD, V-Mart Retail, says the company is still a little away from the pre-COVID numbers on the same store sales. The company has taken some steps to provide the consumer the best fashion, the best product, the best prices and is working on bringing down the average selling price also and launching products to suit Gen Z consumers as well.
“We should try and grow by 18-19% this year and that is what our expectations are”, says Agarwal.
What is playing out in the retail sector? The retail space has been on the value side. Tell us about the demand trends. What is it in terms of the footfalls that you are seeing? How are you envisaging this moving forward in Q1?Lalit Agarwal: This is definitely considered more of a value segment by the consumers and overall globally, value has been the key driver and in fact the most successful driver of fashion. So, definitely a lot of inquiry, a lot of consumer aspirations or movement of consumers from unorganised to organised is happening. We have seen some better footfalls. We have seen some better results even on the sales side compared to the earlier quarters.
Also, the consumer demand in the smaller town is coming back and we are seeing a little bit of excitement and even the elections have helped the economy. There is more money in the customers’ pockets. There’s more discussions, more talking, more mobility and more and more consumers are also coming back to their native places to vote, so there is a lot of movement happening in the market. So, we have seen a fairly good response.
In the first month of this quarter, we had some festivals like Eid and Poila Baisakh and stuff in certain parts of the market. But otherwise also, in May and June, literally in this year in the Hindu calendar, the marriages have been avoided in these two months, normally there are a lot of marriages in this time of the year so that is why there is some decline which is also being seen from that particular side of the customer segment who consume because of marriages and so there is a drop but on the other side we are seeing a good customer coming back on the holiday or the vacation consumer who want to go on holiday, who want to travel, who want to go to their relatives, some of those consumers are also coming in. So, we are seeing on an average a little muted but still there is a growth in the month of May as well.Where do you see your revenue growth and SSSG growth for FY25? You did almost 6% in the quarter in terms of SSSG. Is it expected to accelerate to double digit and hence what will be the revenue growth for the year then?Lalit Agarwal: We are working towards growth of our business. We know that we are still a little away from the pre-COVID numbers on the same store side. There are some activities that we are doing, a lot of internal work that we have done, a lot of work on an internal ability to provide the consumer the best fashion, the best product, the best prices and bringing down the average selling price also, launching those Gen Z consumer likings which is the new style product and new style clothes and the new styles of displays and the marketing.
So, a lot of effort is going on in the organisation and there is a lot of capability development that we have done in the last two years. So, some of the results are being seen. So, we definitely grew in the last quarter. We should continue at least that kind of growth or even more in this particular year is what we are feeling and we should be more positive in terms of our growth as well because last year we grew by like 13-14%, we should try and grow by 18-19% this year that is what our expectations are.
I am just now seeing the presentation and your numbers, quarter four this time around also the company has reported a loss versus last year it was a loss. Anything specific that is impacting the quarter in terms of the bottom line?
Lalit Agarwal: The fourth quarter normally is a loss quarter because this is the quarter when you have the last remaining seasonal inventory of winter which goes out so there are a lot of sales and discounts which happens so only there is one or half month of March where you get a full price sell through.
Normally this particular quarter does not show a lot of profits or does not show a profit at all. I think we are in line with what we had expected and the only piece is in our online burn that we have been doing at Limeroad. So, we will work to curtail that burn and we will want to reduce that burn so there are some of those things which will also help in the coming year.
Last year we had a lot of those burns and we will work on that. It is more about the same store sales growth because the entire year, we did not see a lot of same store sales growth. This year, we should be able to get those same store sales growth as well.
What about the overall setup with respect to Limeroad because that acquisition has taken time to turn around quite a bit for you. Is there anything else in the pipeline and what is the scale up plan here?
Lalit Agarwal: No, nothing is on the pipeline. We are trying to bring that platform and integrate that with our offline.
