Metro Brands sees higher priced products increase in popularity
Footwear business Metro Brands has seen sales growth in its premium products segment and this has led to an increase in profit. The business expects this trend to continue.
“We saw significant growth in the over Rs 3,000 [$40.41] category,” Metro Brands’ CEO Nissan Joseph told ET Brands. “We are also fortunate that we do not have much of a business under the Rs 1,000 business that is going to be impacted by GST. What we are seeing on the margin is just continued discipline and the fact that our own home brands continue to grow. They grew 300 bps as a share of business from 70% to 73% in the last quarter.”
The business recently reported a 59% increase in revenue in the third quarter, 2022, to which increased sales of more premium products contributed significantly. The quarter was its first earnings release since listing and also saw its margins expand to 35%. Joseph expects the trend of rising premium product sales to continue, although the business will continue to also focus on value.
“Metro believes in providing affordable and aspirational yet premium products so we want to make sure that we hit on those three vectors – it is premium, it is affordable and it is aspirational,” said Joseph. “If you look at our business growth, you can see we are focused on products that bring that value to the customers. It is probably going to lean towards the upper end of the price range.”
The business also expects to maintain the same growth trajectory it has been on for the past decade including 16% revenue growth and 18% profit growth, despite the pandemic. With recent double digit growth in online sales, Metro Brands’ omni-channel approach is also fuelling growth.
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