Arvind Brands to invest Rs 100 cr in TCP tie-up

Firming up its position in the growing kidswear segment in the country, Arvind Lifestyle Brands,  a subsidiary of textiles major Arvind, on Thursday announced its plan to tie up with leading US brand The Children’s Place (TCP) and declared an investment of Rs 100 crore.

In an interaction with Deccan Herald during the launch of the first outlet of TCP, Arvind Lifestyle Brands Managing Director and CEO Suresh J said the move comes after acknowledging the growing importance of the kidswear  segment in the country and the company’s efforts to take leadership position in the segment.

“The total kidswear market in the country is Rs 50,000 crore and most of them are done via unorganised sector. Now organised players coming to this segment and Arvind has kicked off its broad plans by tying up with world leader TCP as our partner,”he said.

TCP, established in 1989, is a leading children’s specialty retailer from North America which supplies fashionable, high-quality merchandise at value prices. It has total revenues of $1.8 billion.

“We are looking around 32 to 40 outlets in the country within a five-year period and will have a footprint in 15 to 20 towns. The average store size will be between 2,000 sq ft to 3,000 sq feet. Arvind is largely a men’s wear company which contributes 70 per cent of our total revenue. Now kidswear  contribute only six per cent and want to take it up to 15 per cent by 2018,” Suresh said.

The US kidswear brand offers products across categories like apparel, footwear, and accessories for boys, girls, and newborns covering the age group up to 14 years.

To maintain 60:40 mix

When asked about the disadvantage of depending on foreign brands, he said the company has grown to this level because of the combination of brands.

“We operate through franchisee and joint venture agreements. Right now 60 per cent of revenue comes from foreign brands and 40 per cent from our own. We will continue to play in the same ratio. We have long-term agreement with most of the foreign brands and as far as longevity is concerned, they are like our own brands,” he said.

Suresh also said the company would give due importance to the online market and establish its brand presence via standalone stores.

“We have 14 foreign brands and 12 own brands. We  are giving primacy to our own stores. But we are ready to take up the online trading explosion happening in the country,”Suresh said.

While parent Arvind posted a 33 per cent drop in net profit to Rs 61 crore for the quarter ending June 30, consolidated sales at the company’s brands and retail business, which accounts for 28 per cent of the company’s turnover, were up by 14 per cent to Rs 527.96 crore from Rs 462.87.