Dear Shareholders,
The past year has been transformative for our industry, marked by
unique challenges and opportunities that have necessitated a reshaping of our approach to
business. The rapid evolution of value fashion retail formats as also the emergence of a
number of Digital first brands which are expanding into physical retail have meant an
intensifying of competition for the customer wallet.
The exuberance of 2022-23 which was in large parts led by the post
COVID shopping surge moderated quite significantly in the past year. Coupled with a change
of the consumer landscape to a much younger customer being the driver of demand and change
of clothing styles, this has necessitated a much sharper product assortment.
This change has also meant the need to revisit ways of working, and
defining a clearer positioning as also taking strategic steps to strengthen where the
brand can continue to win. It is in the backdrop of this that in the past year your
company embarked on some significant strategic steps to refocus its effort.
Firstly, we decided to focus on being a menswear only brand and to that
effect have discontinued the boys-wear segment. Post COVID, with a fundamental shift in
the consumer buying behavior to online and greater expectations of value pricing, we no
longer see this as a sustainable, scalable business. Accordingly from second quarter of
last year we have discontinued this business. This is expected to improve the overall
profitability of the business the next 18 months.
Secondly, we have decided to strategically refocus and strengthen our
presence in select geographies where we continue to see potential and scalability and
accordingly all our actions of retail and distribution expansion in these markets with an
aim to become large and among the top 3 brands in these regions.
Thirdly, with a aim to substantially improve profitability and reduce
our working capital, we have embarked on a transformative operational excellence project
using the globally acclaimed "Theory of Constraints" management philosophy. With
a focus on sharper product assortments, supply chain agility of sketch to sample and focus
on the highest throughput channels namely Retail and Distribution we are starting to
seeing significant benefits and the full effects of these changes will be seen in the
current year and the next year.
Lastly, the growing E Commerce and younger customers driving
consumption has meant a unique opportunity to use this channel for its strengths and to
that effect we will continue to invest and scale up the E commerce business.
It is against the backdrop of these significant changes that the
performance of your company is to be viewed for the past year wherein revenue dropped by
10% to 456 Cr. We have taken decisive steps to sharpen our focus, exit from low profit
lines of business and tighten the working capital significantly to strengthen our balance
sheet.
Indian Terrain has a unique signature and reach with more than 240 own
retail and 800+ Multi Brand Outlets which reach consumers across 180 towns. The markets we
serve are large and the opportunity is immense. I am confident that with this renewed
focus we will once again grow and this time in a much more robust manner.
No goal is possible to accomplish without the team's full
commitment and to this, I thank and salute all my colleagues at Indian terrain whose
unwavering passion and belief in the brand and ability to pivot has been something
I'm really proud of.
Lastly, I am extremely grateful to you, our valued shareholders for
your continued support and guidance as we embark on this journey of transformation and
change and navigate the challenges in the coming year. The path will be rocky but the
destination is one of sunshine and I am confident that we will emerge stronger as a brand
and company in the years to come.
Sincerely,
Venky Rajagopal
Executive Chairman and Whole Time Director