Demand is now coming back to normal: Gautam Hari Singhania

Interview with CMD, Raymond group

Fabric-to-fashion company Raymond has started reaching out to customers by setting up manufacturing units closer to the market, even as it remains committed to the ‘Make in India’ story. Gautam Hari Singhania, chairman and managing director, Raymond group, tells Dilip Kumar Jha of his company’s business plans. Edited excerpts:

Raymond has expanded its footprint by acquiring a garment unit in south India, land in Ethiopia and office spaces in many countries. What is the strategy?
 

We are the largest suiting manufacturer in the country. Our garmenting business is based largely on  business-to-business exports serving some of the top global fashion brands. Of the 55 countries in five continents that we supply our products to, the US contributes 30%, Europe 25% and Japan 20%. Exports contribute 15% to our overall revenue. We now want to move from an ‘export only’ model to developing markets and establishing a face to the name in select regions. We have shortlisted markets where we would like to invest in building deeper relationships with fashion brands. 

We continue to remain committed to the ‘Make in India’ story with recent capacity expansion in our plants in Kolhapur and Yavatmal. The plant in Ethiopia will help mitigate our export risk. Ethiopia has duty-free access to the US and European markets, making our products competitively priced.

Most of Raymond’s profit is from fabrics. How are you planning to strengthen the apparel business?
 

Raymond commands over 80% market share in the worsted fabric segment. Over the past three years, we have aggressively invested in the branded fabric portfolio and have now emerged as a market leader in this segment, too. Apparel is another strategic business for Raymond with four power brands in our portfolio: Raymond, Park Avenue, Parx and ColorPlus. We are among the three biggest apparel brand players in India. Our focus is to sharpen brand positioning. We are also expanding our retail footprint through exclusive brand stores, the large format retail footprint and multi-brand stores. We are renovating our existing stores to enhance the shopping experience.

How do you plan to catch the fancy of the youth?
 

Raymond caters to over 20 million users across age groups and we have a little over four million customers on our loyalty platform. Each brand in our portfolio has a sharp role assigned to it in the context of brand positioning and product offering. Parx is a youth-oriented and the fastest growing casual brand in the country. Park Avenue has a strong focus on formal offerings for the young generation. Having extended itself to women’s wear is testimony to the brand’s journey.

Denim has been growing faster than any other segment. What are your plans to strengthen your denim business?
 

Our denim division is a market leader in fabrics and garmenting. Through trade shows abroad and our strong Indian network, we keep launching new and innovative products to cater to the changing requirements of our customers. We are increasing our investments in design and development and using local and international talent to support this.

Many of your competitors have tied up with global brands…
 

We keep receiving proposals from global brands and fashion retailers for strategic partnerships. As a policy, we evaluate these options, however, our focus is to upscale and grow our brands.

What has been the effect of demonetisation on Raymond?
 

The cash-dependent wholesale channel was temporarily impacted and the squeeze in liquidity affected our business for a short period. As cash is restored, we are witnessing a pick-up in sales, demand is now coming back to normal. We are expecting a better performance in the current quarter.