Malls may unveil Victoria’s Secret stores as early as next year

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March 2, 2021 4:30 AM

“We do not have concrete information yet about the kind of outlet they will introduce here, whether it will only be a beauty store like the ones they have at the airport or if it will be a full lingerie store. If they only set up a beauty store, it will not be that exciting,” the source said.

The total retail segment is estimated to touch Rs 130-140 trillion by 2031-32.

Victoria’s Secret, the premium lingerie and beauty retailer from the house of L Brands. is looking to launch stores in India. “They are asking for space in malls. The discussions were on hold due to Covid but the talks have resumed,” a source aware of the development told FE. The negotiations are preliminary and if the deal goes through, the company’s foray into the market may happen as early as next year.

US-based L Brands which operates its bath shop chain Bath & Body Works in India through franchise partner Major Brands is expected to explore the same arrangement for Victoria’s Secret, according to industry sources. Major Brands did not respond to FE’s queries. Victoria’s Secret’s bricks-and-mortar presence in India currently is restricted to a handful of airport stores.

“We do not have concrete information yet about the kind of outlet they will introduce here, whether it will only be a beauty store like the ones they have at the airport or if it will be a full lingerie store. If they only set up a beauty store, it will not be that exciting,” the source said.

The brand is setting the pitch for its India play even as the pandemic has crippled its business globally. Last year, Victoria’s Secret permanently closed 241 stores in North America and has projected to shut another 30 to 50 stores in the region. The sales impact of the 241 shut stores is estimated to be nearly $500 million, L Brands said in a statement last month. As the deal to sell a majority stake in Victoria’s Secret to private equity firm Sycamore Partners failed to take off, L Brands now plans to separate its Bath & Body Works and Victoria’s Secret businesses by August this year.

According to international media reports, Stuart Burgdoerfer, executive vice-president and chief financial officer of L Brands, at a recent earnings call said that the firm is pursuing a dual-path approach to the separation of Victoria’s Secret. “Dual-path meaning, looking at a spin option where Victoria’s would become its own public company and separately, a sale option where we would sell it to a third party,” Burgdoerfer said.

India with its young working class and rising disposable incomes is too lucrative a market for brands to overlook. The local apparel market is expected to grow to a Rs 5,700-5,800-billion opportunity by 2024 despite the pandemic-led year-on-year 27% decline in size in 2020, analysts at Boston Consulting Group (BCG) said in a recent report.
Entry of international brands is one of the factors that will fuel consumption, they said. The total retail segment is estimated to touch Rs 130-140 trillion by 2031-32.

A bunch of global brands are looking to expand their India presence. Ingka Group, the parent company of Swedish home furniture giant Ikea, for instance, recently announced the acquisition of a 48,000-square-metre land parcel in Noida for developing an Ikea store anchored retail shopping mall under its Ingka Centres business concept called Meeting Place.

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