Go Fashion India Ltd. (GFIL), a women’s bottomwear clothing firm, will not lower selling prices even if there is a decline in raw material prices, said CEO Gautam Saraogi.
“Even if the raw material price goes down, we will not bring down our selling price because if we even think about doing that, it will create a very negative impact in front of our end customers,” he said during an earnings call.
He also said that Go Fashion leggings and churidars are priced at about ₹599. About 80% of the company’s product portfolio is priced less than ₹1,000. Mr. Saraogi said a price increase had been effected based on the raw material cost increase over the last 18 months.
During FY22, GFIL effected two price increases. The first such, in years, was in response to increase in the sourcing cost of goods sold. “But as of now, the price fluctuations are steady as far as raw material is concerned from what we have seen in the last 3-4 months,” he said.
Expressing optimism about the growth prospects, he said the total bottomwear market was expected to grow at 12.4% per annum to emerge as a ₹24,000 crore opportunity by 2025. The organised bottomwear market was expected to grow by three times to ₹9,000 crore.
“We have chosen to focus exclusively on the bottomwear segment. We will not dilute our attention by allocating our investable resources in seeding other apparel segments,” he said in the annual report.
Asserting that GFIL would address only a specific segment of this market [the upper to mid-market customer], he said this segment accounted for the largest share of the market. It was growing following evolving lifestyle patterns and price positioning.
During the current fiscal, GFIL plans to open 120-130 exclusive brand outlets (EBOs) at an investment of ₹35 lakh each with a pay back time of 15-18 months.
As on date, GFIL has 513 EBOs and 1,473 large format stores across 31 States and UTs. It also generate sales through multi-brand outlets and online.