Zudio’s expansion plans are aggressive on multiple yardsticks, especially at a time when a wrenching slowdown in the last six months is prompting retailers and restaurant chains alike to rethink and scale down their expansion plans in the new year
New Delhi: Tata Group-owned affordable fashion brand Zudio plans to continue its aggressive expansions in 2024-25 and the poster boy of India’s successful fashion business is planning to open up to 200 stores in the coming fiscal year, according to two people familiar with the plans.
One of the people said Trent Ltd., Tata’s listed retail entity, has already rolled out more than 100 Zudio stores in India so far in the current fiscal year and the retailer plans to add more before the fiscal year ends in March 2024 taking the total number of Zudio outlets to slightly shy of the 500-store mark. The company will ramp up expansion in the next fiscal year as well.
“Zudio plans to add anywhere between 150-200 stores in the 2024-25 fiscal year,” he said asking not to be identified. A Trent spokesperson did not respond to an email seeking comment.
Zudio’s expansion plans are aggressive on multiple yardsticks, especially at a time when a wrenching slowdown in the last six months is prompting retailers and restaurant chains alike to rethink and scale down their expansion plans in the new year. For example, a chief executive of a global brand said his company has decided to scale down the expansion of stores amid the slowdown. Similarly, Sagar Daryani, co-founder of Wow! Momo Foods Pvt. Ltd. said the company opened 190 stores last year but the operator of Wow! Momo, Wow! Chicken and Wow! China would end the current fiscal year ending March adding only around 100 stores. “Expansion is slowing a bit which is fine as long as we are conserving capital,” Daryani told IndiaRetailing in a November interview. “I think you should always ride the growth and if it is not the right time to grow, you should not grow for the sake of growing.”
But the slowdown hasn’t hampered Zudio’s plans, the sources said. IndiaRetailing had reported in April that Trent plans to open up to 150 Zudio stores this year, taking the overall number of the affordable brand to slightly shy of 500.
With the 150-200 store target for the fiscal year ending March 2025, the Zudio store count could be anywhere in the range of 650-700 strong.
Zudio has not just been one of the biggest retail success stories from Tata’s stable but many also view it as a business model and case study from India’s retail sector.
What started as a private brand inside Tata’s Star supermarket chain and Westside department stores, came on its own to become one of the fastest-growing brands for the Mumbai conglomerate.
Tata aims to turn Zudio into a billion-dollar brand in the coming years by targeting a compounded annual growth rate (CAGR) of over 25% with Earnings Before Interest, Taxes, Depreciation, and Amortization (EBIDTA) margin of more than 10%, P Venkatesalu, CEO, Trent had said in an April blog post on Tata Business Excellence Group’s website.
Seven-year-old Zudio has played an important part in Trent’s business to more than doubling its standalone revenue from under Rs 3,500 crore pre-pandemic to Rs 8,000 crore in 2022-23, catapulting the retail arm’s market cap to more than $5 billion.
Trent is Tata’s retail venture that also operates the Westside department store chain and Landmark bookstores. The company also has two joint ventures with Spain’s Inditex SA to run Zara and Massimo Dutti labels in India.
Zudio sells apparel for men, women and kids, beauty products and loungewear, priced attractively below Rs 1,000.
