IPO-bound Fabindia Narrows Loss, Revenue Surges 29 pc in FY22
IPO-bound Fabindia Narrows Loss, Revenue Surges 29 pc in FY22

Fabindia has narrowed its losses after sales rose 29 percent in FY22, reversing the performance in the first year of the pandemic when revenues shrunk.

The ethnic retailer posted revenues of Rs 1392 crore during the year ended March 2022 with a net loss of Rs 39 crore, according to documents filed with the Registrar of Companies and sourced from business intelligence firm AltInfo. During FY21, the 60-year-old firm, popular for selling ethnic products sourced mostly from rural areas, posted a net loss of Rs 117 crore on revenues of Rs 1081 crore, its worst performance in two decades. 

"Following relaxation in Covid pandemic-related restrictions starting June 2021, improved customer sentiment further aided by the festive season and expansion of the retail store portfolio, the trajectory of revenues continued to improve month on-month till year-end. However, the relative operating performance for a few weeks during the period January-February, 2022 got impacted due to temporary restrictions imposed in wake of Covid third wave, but thereafter resilience has been seen in revenues which resulted in significant improvement in overall performance," Fabindia said in its regulatory filing.

The company has received approval for its Rs 4000-crore IPO from Sebi. During the year, most retailers recovered from Covid restrictions and breached pre-pandemic sales helped by increased mobility, offices reopening, and social events. 

While India is still a largely unorganized market for traditional and ethnic products, several retailers from leading department chains have been offering contemporary styling in the ethnic-wear space, ratcheting up competition for Fabindia which has more than 300 stores. For instance, Aditya Birla Fashion and Retail has accelerated its play in the branded ethnic wear segment by acquiring Jaypore, investing in Shantanu and Nikhil, Tarun Tahiliani and Sabyasachi, and announcing two new organic entries - Marigold Lane and Tasva – premium ethnic wear brands.

Fabindia was founded in 1960 by John Bissell to market the craft traditions of India. It started out as an exporter of home furnishings and the first retail store came up in the Greater Kailash area of Delhi 15 years later. In the mid-1990s, Bissell’s son, William, took over the company. In 2000, the company added the non-textile range, while organic foods and personal-care products were launched a decade ago. A few years ago, Fabindia launched four business units (SBUs)— Home and Lifestyle, Personal Care, Fabcafé, and E-commerce—to sharpen its focus and expand.

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