Modenik Lifestyle: Unleashing synergies post-merger

Modenik Lifestyle is the merged entity of two leading essential wear companies – Enamor and Dixcy.

Modenik Lifestyle: Unleashing synergies post-merger
Sunil Sethi, Executive Chairman of Modenik Lifestyle

Modenik Lifestyle is the merged entity of two leading essential wear companies – Enamor and Dixcy. Now Modenik offers choices for both men and women’s essential clothing across price segments. We spoke to Sunil Sethi, Executive Chairman of Modenik Lifestyle to understand how the company is performing post the merger. Excerpts of the interview are shared below:

What was the strategy behind the merger of Dixcy Textiles Pvt Ltd & Gokaldas Intimate wear Pvt Ltd (the parent company of brand Enamor)?

At Modenik Lifestyle, our vision is ‘to be the most preferred company for comfortable and fashionable essential clothing’, which includes inner wear, thermal wear, casual wear, and athleisure. The merger was about creating the right ecosystem to bring our vision to life.

We were operating as two separate companies, Dixcy Scott and Levis Innerwear in the men’s segment and Enamor in the women’s segment. We merged the two companies to build one strong platform which offers the consumer choices across different age groups, genders, categories of essential clothing and across price segments – i.e., Economy, Mainstream and Premium segments. The merger also leverages the operational efficiencies and manufacturing and distribution synergies between the two entities to improve our margins and create a sustainable profitable business.

The coming together of the two organisations is a win-win for all the stakeholders, be it the consumers, shareholders, business partners or employees. The merger has created opportunities for employees to handle bigger and better roles and grow within the organisation. As we grow our business partners are also growing and as we are bringing in efficiencies through processes and technology, their margins will also grow.

Can you please share brief details on the merged entity Modenik Lifestyle Pvt Ltd – plants, employees, sales and distribution models, etc?

We have a total employee strength of around 5000 with 1600 employees and 3400 staff across manufacturing operations in Tirupur, Kolkata, Bengaluru and Ludhiana, with 400+ job workers and contract manufacturers. Modenik today has over 1400 distributors.

Modenik now has a strong portfolio of 5 sub-brands, including Dixcy Scott Originals, Dixcy Scott Maximus, Josh by Dixcy Scott, Slimz and Enamor and an exclusive licensing agreement with Levi’s to manufacture and distribute innerwear in India. Currently Dixcy Scott is available in 100,000 multi brand outlets (MBOs) and we are expanding our distribution and planning to reach 200,000 stores directly in 12-18 months. Enamor is present in 4,500 MBO’s and we are planning to take this to 10,000 stores by year end. We have hastened the pace of opening our exclusive outlets (EBOs) for Enamor and from 50 EBOs currently we will take this number to 100 in the next 18-24 months.

At the same time, we are leveraging e-commerce as a channel. Since 2020, we have seen 5X growth across the three brands – Dixcy Scott, Levi’s and Enamor, and we continue to build this channel as it is expected to grow further.

How do you plan to set yourself apart from the new age brands competing in the essential wear market?

We are driving innovation in our product and packaging across our entire Dixcy and Enamor product range to meet the changing consumer needs and preferences.

Recently, we unveiled a new brand identity for our men’s brand Dixcy Scott that aims to capture new age consumers with innovations across product design, quality and durability. With this relaunch, Dixcy Scott positioning has shifted from the existing category code of a hyper-masculine persona to celebrate the emergence of the confident new man that today’s consumer can relate to.

Similarly, Enamor is among the first brands to bring international quality lingerie to India and continues to do so today by investing in technology and design to stay ahead of the curve. Enamor has invested heavily in research and we have curated our lingerie collections to meet the evolving needs and preferences of women. Our collections are high on innovation, style and comfort and being a brand that focuses on sustainability, we have introduced lingerie that incorporates sustainable fabrics.

How has the company been performing till now?

Last year, Modenik clocked revenue growth of 20% and EBITA growth of 80% and all this despite the 2 waves of COVID. For Enamor specifically, it has seen solid traction across channels for its athleisure wear and lingerie and has grown more than 45% in 2021-22.

What are your expansion/growth plans for 2022?

Dixcy Scott will focus on offering a broad range of products and designs across innerwear, thermal wear and casualwear categories, and on increasing penetration across the country in tier 2 and tier 3 cities, for propelling the growth in this segment. For Enamor, we recently launched EBOs in Jaipur & Nagpur and we will continue investing in EBOs. We are aiming to open about 25 more stores in the next 12-16 months.

Along with this we will continue to build the e-commerce channel and this year too we are anticipating growth for all 3 categories- inner wear, casual wear, thermals in this channel. On the distribution front, we are planning to introduce a specialist channel to distribute premium products. We are now embarking upon a complete go to market revamp and we are moving to digitising, bringing in efficiencies across the value chains through process and technology.

How are you leveraging the current outlook for India, trends, and growth especially post-Covid?

A preference for branded innerwear that offers better fit and comfort are major factors fuelling demand for innerwear and thereby driving the growth of the innerwear market. The casual wear market is growing at 12-15% on the back of Covid-19 motivated shift to casual and smart clothing that fits in with changing lifestyle. This preference for casual wear is expected to continue over the next 3 to 5 years.

As the innerwear and casual wear market grows in the country, we are also set to grow exponentially. We are increasing the depth of our supply chain and making it more agile to handle any disruptions. We are extending our distribution network to increase our market penetration. We have launched Enamor’s collections offering a vast range of athleisure wear and loungewear in women’s categories, addressing the demand for fashion and comfort.

Advancements in technology have also brought in newer fabrics. Our use of technology enables our products to be constructed with newer fabrics that offer benefits such as, comfort, durability, easy care, and more.

Most importantly, the emergence of e-commerce as a channel for innerwear has proven to be game-changers for the consumers and the industry. Modenik’s omni-channel distribution capability ensures that the products are available across offline and online channels.

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