Why is Zudio growing? ‘No other clothing chain’ does this as per ace fund manager Saurabh Mukherjea

Tata group’s budget-friendly retail apparel chain Zudio has seen exponential growth in the last few years.

Fund manager Saurabh Mukherjea said that Tata group’s budget-friendly retail apparel chain Zudio is successful because of the brand’s ability to refresh its inventory every few days. Zudio has seen exponential growth in the last few years and as per domestic brokerage Motilal Oswal Financial Services, it could be an outlier in its sector for fourth quarter results for FY24.

Zudio has seen exponential growth in the last few years. What ace fund manager thinks about the success of the brand

“Zudio refreshes its inventory every 15 days. No other apparel firm in the industry turns its inventory as fast. Our estimate is that they are 3-5 times historically faster than its competitors,” Saurabh Mukherjea said.

He said, “What we have witnessed is that their turns are radically faster… and to build a back-end that quickly develops new clothes, designs and according to the tastes of different cities, it takes an enormous analytical effort and it will be difficult for anyone to replicate that."

This comes after Marcellus Investment Managers apparel retailer Tata Trent, that owns and operates Zudio, to its Consistent Compounders Portfolio and highlighted the competitive advantages of the move.

The fund management team at Marcellus then said, “Once these strengths were developed for Westside, formats like Zudio have subsequently been built on the same tenets through usage of common vendors, warehousing, and logistics at the back end and common store opening teams at the front-end."