July 14, 2024
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Arvind Fashions Sells Sephora Retail Division To Reliance For ₹ 99 Crore

Billionaire Mukesh Ambani’s Reliance is set to collaborate with Sephora, a beauty chain owned by LVMH, to manage its stores across India and facilitate the expansion of Sephora in the country’s rapidly growing beauty and cosmetics market. Reliance, India’s largest retailer, launched its beauty retail platform called Tira in April to compete with Nykaa and the Tata Group. The agreement entails Reliance taking over Sephora’s 26 stores in India from its previous partner, Arvind Fashions, marking the end of their eight-year collaboration.

Reliance Retail Ventures Ltd (RRVL) will have exclusive rights to develop and strengthen Sephora’s presence in India through various channels, according to a statement from Reliance Retail. Sephora offers a range of products, including makeup and skincare, featuring luxury brands like Dior and Tom Ford, and recently becoming the exclusive retailer for Selena Gomez’s Rare Beauty brand in India.

The 990.2 million-rupee ($11.89 million) deal between Reliance and Arvind Fashions follows earlier reports that Sephora and Reliance had discontinued talks for a retail partnership in the Indian market. The beauty industry in India is witnessing intense competition as demand for clean beauty and celebrity-endorsed brands rises. Companies like Nykaa, Tira, and Shoppers Stop have expanded their offerings to attract and retain customers.

Sephora’s Asia President, Alia Gogi, emphasized that increasing affluence, urbanization, and the influence of social media have heightened awareness of self-care and beauty, presenting significant opportunities for prestige beauty in the market. Following the news, shares of Arvind Fashions experienced an 11.5% surge before settling at a 5.8% higher close. The beauty division hosting Sephora contributed 3.37 billion rupees to Arvind Fashions’ fiscal 2023 revenue, accounting for approximately 7.6% of the total. Proceeds from the deal will be used by Arvind Fashions to invest in its brands and repay debts.

Picture Courtesy: Google/images are subject to copyright

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