Indian apparel market is valued at INR1,511.07 billion in 2005-06, constituting men’s, women’s and kid’s apparels. Men’s apparel segment constitutes the major share in value and volume terms. It is observed that the school uniforms segment has been emerging as the high growth segment both in terms of volume and value. There was an increase in usage of ready-to-wear branded uniforms during the year, which indicates an immense potential for branded players. It is also observed that the apparel market has been experiencing significant value addition in the recent past—an increase of 4.41% in volume has yielded 12.95% growth in revenue in 2005-06. This demonstrates that the organised branded segment is fast increasing its share in the apparel market.
With the significant growth of Indian apparel industry, its constituent sectors are also poised to grow in future. The kidswear segment, which has been a bastion of unorganised players hitherto, is becoming a niche segment, with the entry of big names such as Raymond and foreign brands like Disney into Indian kidswear market. India is one of the potential markets for kidswear; its children population constitutes around 35% of total population and is growing at an average annual rate of 2%. The growing income and number of double-income families, increasing consumption expenditure, especially on clothing and footwear, increasing urbanisation, growing ‘pester power’ of kids and parents’ willingness to spend on kids garments are some of the factors complementing the growth of the industry. This report analyses the dimensions of the Indian kidswear industry in terms of its size, growth trends, growth drivers, critical success factors and future growth prospects, and also gives profiles of some of the major kidswear manufacturer-retailers.
4. Global kidswear market
4.1 Industry overview
4.2 Market size and growth
4.3 Regional market share
4.4 Important characteristics of global kidswear markets
4.5 Major players
5. Indian kids garment market
5.1 Industry overview
5.2 Market size and growth
5.3 Market segmentation
5.4 Typical characteristics of Indian kidswear market
5.5 Industry trends
6. Growth drivers
6.2 Shift in income classes
6.3 Changing consumption pattern
6.4 Booming retail industry
6.5 Untapped market potential
6.6 High margin realisation in kidswear retailing
6.7 Demand for range and price
6.8 Media proliferation and awareness
6.9 Mainstream influences
6.10 Export advantage
7. SWOT analysis
8. Critical success factors
8.1 Product & fashion innovations and design capabilities
8.2 Ability to differentiate products
8.3 Brand building
8.4 Understanding the target group, their buying behaviour/pattern
8.5 Understanding the seasonality in buying
8.6 Gaining eye-balls through market promotion & advertising
8.7 Creating market presence through better retailing
9. Major players
9.1 DS Corporation
9.2 Gini and Jony Ltd
9.3 Lillput Kidswear Ltd
9.4 Personality Ltd
9.5 Polki Garments Ltd
9.6 Raymond Apparel Ltd
9.7 Trent Ltd
10. Relative comparison of major brands in kids segment
10.1 Relative comparison of Major Brands in Kids Segment
10.2 Market concentration analysis
10.3 Industry status matrix
Annexure I: List of Abbreviations
Annexure II: Bibliography
LIST OF TABLES
Table 5.1: Market Size of the Major segments in Kidswear
Table 6.1: Projected growth in income classes in India
Table 10.1: Relative comparison of Major Brands in Kids Segment
LIST OF FIGURES
Fig 4.1: Global apparel market- Market segmentation (2006)
Fig 4.2: Global kidswear market size and future projections (2006-10)
Fig 4.3: Revenue share by kidswear categories (2006)
Fig 4.4: Global kidswear market- regional share (2006)
Fig 5.1: Indian Apparel Industry- Segmental share (2005-06)
Fig 5.2: Trends in volume and value of kidswear market (2001-02 to 2005-06)
Fig 6.1: Age group-wise population distribution over years
Fig 6.2: Trends in expenditure on clothing and footwear over years
Fig 6.3: Share of Readymade and Tailormade across customer segments 2005
Fig 10.1: Kidswear Industry Status Matrix
India’s textile and clothing industry, which shares about 14% of the total industrial production and about 17% of total exports, is estimated to be INR1,511.07 billion in 2005-06. It constitutes men’s, women’s and kid’s apparels. Men’s apparel segment constitutes the major share in value terms (37%). Indian kidswear market is valued at around INR226.66 billion in 2005-06, and estimated to have grown by a CAGR of 11.60% between 2001-02 and 2005-06. Increasing number of double-income families, rising personal consumption expenditure, growing ‘pester power’ of children, proliferation of media, especially visual media and increasing number of organised players entering the market can be attributed to the growth of the industry.
The Super Premium segment registered the highest CAGR rate of 25.42% in value terms during 2002-06, followed by School Uniform segment (16.86%). The growth of Super Premium is attributed to the recent entry of organised big players like Gini & Jony, Personality Ltd (Weekender Kids), Arvind Brands (Lee Kids), and Benetton, etc. The shift in the trend from tailor-made uniforms to readymade uniforms can explain the growth of the School Uniform segment.
As per Cygnus estimates, the normalised Herfindahl-Hirschman Index of Indian kidswear market was at 0.8676 or 8676 during 2005-06, indicating a very high market concentration in Indian kidswear It is also indicative of the dominance of unorganised sector and the potential market for organised players to capture in future.
Following factors could be attributed to the growth of the kidswear market in India: the large and growing 1 billion plus population of India, with its 35% child population; the faster growth of middle and high income groups compared to low income groups; the growth of the economy and personal disposable income in general; growing organised retail industry; increasing expenditure on clothing and footwear category in the recent past (10.29% in FY06 over previous year); rising number of double-income households and emergence of nuclear families, resulting in surplus money to be spent on kids; shift from tailored garments to readymade garments; market dominance of unorganised segment (90% share) that spells the opportunity for organised players; demand for range and price of kidswear; media proliferation; and influence of mainstream fashion trends.
Some of the success-determining factors include product and fashion innovations and design capabilities and differentiating products with colour, design and cuts. The other factors include brand building, market entry strategies like own brand development, franchising and licensing, understanding children and their buying behaviour, market promotion measures like advertisement, gaining eye-balls, creating ‘pull’ for a brand, suitable retail formats like MBOs or EBOs, or shop-n-shop, and strategic pricing to take on the low-priced unorganised segment.
The future prospect of the industry is determined by both macro-economic factors as well as micro-level factors. The market size is expected to reach INR347.67 billion in 2009-10, at a growth rate of around 12%. Macro-level factors such as the projected GDP growth of 9% during the eleventh five year plan period, expected growth of the organised retailing industry at a CAGR of around 25%, the projected population growth from the current 1.027 billion in 2001 to 1.3 billion by 2020, are likely to support the growth of industry. Other factors that are expected to complement the growth of the industry in future include the personal consumption expenditure, which is expected to go up from the CAGR of 5.50% during 2001-06 in line with the expected economic growth and growth in the personal disposable income; the expected growth of average household income by a CAGR of 10% during 2006-10; expected increase in proportionate expenditure on clothing and footwear to the total consumption expenditure.
The pan-India developments in this vibrant industry augur well for its growth. The entry of foreign kidswear manufacturers like Tommy Hilfiger, Disney, Adams Kids, Monalisa, and entry of major Indian apparel houses like Raymond; major expansion plans of some of kidswear industry players; looming opportunity for India to become a preferred apparel sourcing destination with its apparent advantage of low-cost manufacturing, coupled with the benefit from the dismantling of the MFA quota system from 2005, are some of the recent significant developments in the landscape of Indian kidswear industry.
However, dominance of unorganised players, uneconomic scale of operation by small unorganised players, low-brand penetration, and uncontrolled entry of foreign kidswear manufacturers could impact the domestic industry. The growth of child population cannot be considered a growth-pushing factor. As the growth rate of child population exceeds the income growth, the income will be divided among more number of children. This will lead to reduced per capita children expenditure. Hence, these factors need to be considered while predicting the future growth prospects of the industry. However, the stronger macro-economic parameters, performing organised retail industry, increasing importance accorded to kidswear segment by major apparel players, increasing interest of foreign players in Indian kidswear market and increasing consumer spending is rationally expected to offset the abovementioned negative factors and help the industry grow in future.