Inditex’s joint venture with Tata sees revenue growth slow to 8 per cent, marking a significant decline from previous years
Spain’s Inditex, the parent company of the popular fashion brand Zara, experienced its slowest sales growth in India, excluding the pandemic year, during FY24. As the world’s largest fashion group, Inditex faced increasing competition in a clothing market that is becoming increasingly crowded with global rivals.
Inditex Trent, a joint venture with Tata that operates 23 Zara stores in India, reported an 8 per cent revenue increase to Rs 2,775 crore in the last fiscal year, a stark contrast to the 40 per cent growth recorded a year earlier, according to Trent’s annual report. Net profit also declined, dropping 8 per cent to Rs 244 crore.
Since its debut in India over a decade ago, Zara has been a significant success, initially doubling its sales every two years. However, the brand’s growth rate has slowed in recent years. “The market is very competitive, and the challenges are real. Nevertheless, the opportunity pool and the size of the market means that there is space for multiple successful players. Trent remains well placed to navigate this next phase of growth by leveraging our platform and growth engines,” said P Venkatesalu, CEO, Trent, in the report.
Trent, which also runs the Westside stores, has shifted its focus to its lower-priced fast fashion brand, Zudio. Zudio opened about four new stores every week on average last fiscal year, bringing the total number of stores to 545. Additionally, Trent has a separate partnership with Inditex to operate Massimo Dutti stores in India, which saw revenues increase by 14 per cent to Rs 102 crore.
