Signs change for Zodiac Clothing
By Mumbai: | 18 Feb 2002
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The CL Raheja-promoted Shoppers’ Stop presently has about 80 per cent of its equity held by its promoters, followed by Zodiac and other institutional promoters like ICICI, IL&FS and JM Morgan Stanley. Last year Zodiac Clothing picked up a stake in Shopper’s Stop by buying out certain institutional shares.
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The bulk of Zodiac’s revenue comes from exports to Europe where its products are sold under different labels including the brand of Zodiac. In recent years, with the European market drifting into recession, Zodiac has increased its focus on the domestic market. In the year 1999-2000 exports accounted for 90 per cent of the income from sales - at Rs 58 crore. In India, Zodiac has over 80 exclusive retail outlets and is slowly planning to increase its presence further.
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Shopper’s Stop, which is planning to float an IPO within the next two years, has, in the meantime, introduced its own private labels and is expected to make profits this year. Analysts tracking the textile industry say that Zodiac faces intense competition from brands like Color Plus, Provogue, Allen Solly, Louise Philippe and Peter England and the tying up with a retail chain like Shopper’s Stop is its way of ensuring shelf space in the future in the retail chain.
A critical factor in the success of Zodiac is its extensive distribution network as it was among the first companies to launch branded clothes in the country. It now ranks among the top five brands selling in the domestic ties market.
Zodiac has also forged alliances with retail chains like de Bijenkorf in Holland and Ciro Citerrio in the UK, though these are more in the nature of exclusive arrangements to stock the Zodiac brand at those stores. Noorani says he is looking at the possibility of picking up a stake with these international chains as well.