Hyderabad: India’s home-grown denim brand Spykar, which has a wide range of products is constantly innovating and is planning to introduce new collection in the growing domestic market. It plans to roll out At Leisure line of collection by February 2019 and will focus on it for next two years. The company which has minor presence in the womenswear category, also has big plans to expand its business in this segment. Currently the womenswear segment accounts for single digit percentage sales to total. There are plans to create an expanded denim portfolio in the near-term. The company which sells 4 million pieces per year plans to double this in next three years.
Sanjay Vakharia, CEO, Spykar Lifestyles, told Telangana Today, “We have constantly focused on innovation in our denim products. We bring almost 400 different styles every year. We innovate in the entire fulcrum of the segment we operate. We have expanded our categories three-fold and have a broad product range today. We have evolved over the years with a clear strategy for growth. Earlier we used to make products as well. But we have realised that we can outsource that part and focus on retail and distribution and remain asset light. We now have no plans to get into production.”
The company’s Active category offers highly fashionable denim products while its YnR (young and restless collection) is seeing surge in demand among the youth. Spykar is also using digital medium to grow its sales by typing up with partners such as Flipkart and Jabong. Offline (brick and mortar) still contribute the bulk of its sales at 92 per cent.
On the market trends, he said, “Premium jeans segment is growing in India gradually. The market is today estimated at about Rs 8,000 crore, growing at a rate of 10-12 per cent every year. Our growth rate has been in the range of 15-20 per cent, well above the industry average. We nominate the right suppliers for consistent and standardised sourcing of fabric, which ensures we get quality material.”
Mumbai-based Spykar Lifestyles has managed to achieve a 20 per cent growth. Customer sales grew from Rs 460 crore in FY 2016-17 to Rs 550 crore in FY 2017-18. The company’s earnings before interest, taxes, depreciation, and amortisation (EBITDA) grew four times in the last three years.
Though west and north markets contribute most to the company’s sales (Rs 550 crore nationally), Telangana and AP customers who had been embracing the brand contributed Rs 50 crore sales during FY 2017-18.
He added, “Despite being afflicted by major challenges such as demonetisation and GST, Spykar has maintained increased profitability and constant revenue growth year-on-year. We today operate through 900 multi-brand outlets in 350 cities of India. We have 225 franchise stores across India and we want to take this number to 350 stores in next three years. Our 25-year old brand has spread to tier-2 and tier-3 cities as well. ”
Talking of the market potential, Vakharia says, India is a young nation and youth is a major driving factors for denim products. Global markets have saturated, but there is health growth in the domestic market. Spykar wants to cash in on the potential India as a market has. The company plans to concentrate on Tamil Nadu and Kerala markets in south in the next 2-3 years.