PDS Multinational Fashions (PDS), which had registered seven per cent decline in sales in FY21 due to the Covid-19 induced slowdown, is expecting close to 20 per cent growth during the current fiscal. The20 per cent is higher than the company’s initial estimates of around 12-15 per cent growth in FY22.
According to Sanjay Jain, CEO, PDS, the company has registered a growth of nearly 35 per cent in revenues at ₹3,821 crores during the first half of this fiscal as compared to ₹2,822 crores in H1 FY21. EBITDA margin also improved to 3.1 per cent as against 2 per cent in H1 FY21.
“We have already touched 90 per cent of last years’ profit during the first half of this fiscal. The current quarter and the remaining part of the year is also looking very good. So against an earlier estimate of 12-15 per cent growth we expect the growth to be around 20 per cent during the current fiscal,” Jain told BusinessLine .
For the quarter ended September 30, 2021, the company registered 18 per cent growth in revenues at ₹2,195 crores (₹1,856 crore in Q2 FY21).
Expansion and diversification
The ₹6,200 crore company, which is into apparels, is looking to expand into home fashion and active wear categories across existing markets. Plans are also afoot to diversify and strengthen its presence in newer markets.
PDS offers a global plug-and-play, design-led sourcing, manufacturing and supply chain platform and caters to over 190 leading brands and retailers globally.
“We are strategizing a way forward by unlocking potential in untapped geographies and categories. We are building teams, collaborating with marquee customers, increasing the wallet share with existing customers, and also at the backend very much strengthening our vendor network,” Jain said in the post earnings conference call.
Europe and the UK are predominant markets for PDS accounting for nearly 84 per cent of its total business. The company is looking to deepen its presence in the North American markets in the first half.
“While we continue to strengthen and grow in our key markets, we are accelerating our presence in North America. In the first half of this fiscal, we have achieved sales almost equivalent to the sales in the entire year in the US market in the last year. Close to 15 per cent of our current topline is coming in from the US as a market and it used to be 9 per cent about two years back and we believe we are well on track for the North American market to cross the target of 20 per cent share that we had foreseen as part of our overall topline,” he said.
New business heads
The company has also been onboarding new business heads to get better access to newer geographies and introduce new categories. The new business heads and vertical heads who bring in access to geographies, customer categories would help propel the growth journey and profitability of the company.
Apart from making inroads into newer markets and adding new categories, PDS is also putting in equal efforts to strengthen its backend that is sourcing. While Bangladesh continues to be its key sourcing location, it is paying equal emphasis to Turkey which currently contributes about six per cent of its global sourcing. Plans are afoot to enhance sourcing from Vietnam, which currently accounts for around two per cent of its global sourcing.