Reliance's YOUSTA is denting ZUDIO's growth in a serious way!
It’s crazy how fast Reliance’s Yousta is catching up with Tata Group’s Zudio 🙌🙌
It’s crazy how fast Reliance’s Yousta is catching up with Tata Group’s Zudio 🙌🙌
While Zudio has a total of ~560 outlets and continues to open a new store every 5 days
Yousta’s team has handsomely caught up to become 10% as big. It has opened ~60 outlets in 39 cities in just 16 months since the launch of the first-ever store in Hyderabad in Aug 2023
That comes to an average of a new store every 8 days. And pace would have been much slower in the initial days.
Thus, most likely, it’s opening a new store just as fast as Zudio today!
Today, Yousta has 6 outlets in Pune, 4 in Hyderabad and Bengaluru, and 3 in Mumbai and Vadodara each.
Then there are Surat, Randhi, Manipal and Dehradun with 2 outlets each. And overall, there are 30 more cities, with one outlet.
And, all of this comes at a time, when Reliance Retail has practically shut nearly a thousand outlets across formats in the last 12 months
That’s an indicator that Reliance has gone bullish and aggressive on Yousta at a time when it’s playing very conservatively in all other retail formats
And that’s sort of proof, that Reliance management believes that Yousta is receiving ample love
Otherwise, I doubt that Reliance would have been playing this with such energy 🙌🙌
And it’s not just Reliance.
Just 2 months before Reliance launched Yousta, Shoppers Stoo had also launched Intune to compete in the same segment.
And it too has ~60 outlets in about 20 cities today. Thus, just as aggressive, with a higher focus on major cities
Thus, practically, Reliance and Shoppers Stop have as a combination built a competitor which is 20% the size of Zudio in just about 16-18 months
And that explains better than anything else, why Zudio’s sales growth has slowed down rapidly, which also drove down the stock steeply post-Q2FY25 results 📛📛
Because numbers are clearly capturing the impact of pain caused by Reliance and Shoppers Stop. And as Reliance and Shopper’s Stop continue with Yousta and Intune’s rapid expansion, the impact on Zudio will only grow.
..
This explains why Trent’s management has been launching newer formats and businesses.
In the last 6 months, they have launched Misbu to compete with Reliance’s Tira, Dabur’s NewU, Nykaa and others in the beauty and personal care segment
And in a bid to drive up margins and AOV at Westside, it has also forayed into lab-grown diamond jewellery
Because the management knows, that Zudio can no longer grow the way it had been growing, and the shareholders need growth anyhow 📛📛
Did you know this?
Best,
Jayant Mundhra
Great cover!
Also ABFRL has also positioned itself by launching Styleup to compete in this same category. Though number of stores are only 32 across India.