Ace Turtle, the company behind denim brands Lee, Wrangler and G-Star, is stepping away from India’s crowded value denim segment, sharpening its focus on premium brands as it looks to rebuild margins and define a clearer market position.
Its chief executive, Nitin Chhabra, told Mint that the shift has meant it now has a tighter strategy centred on fashion, sourcing and distribution.
“We are on track to achieve Ebitda positivity in the September quarter. For the full fiscal year, we are targeting a strong growth trajectory, with revenues expected to rise by approximately 25% compared to the previous year,” he said. Ebitda is short for earnings before interest, taxes, depreciation and amotrization.
The company, which competes with Levi's, Spykar, Killer, Mufti, Numero Uno and Indian Terrain, is repositioning itself in the mid- to high-premium segment, staying away from value pricing, he added.
While Lee and Wrangler continue to anchor revenues, G-Star is being built as the next layer of premiumization, creating a defined upgrade path for consumers. Chhabra said it is the demand momentum, particularly outside metros, that is driving the turnaround. Ace Turtle introduced G-Star in 2025 after its earlier licensing arrangement with Reliance Brands Ltd ended.
Instead of a rapid rollout of standalone stores, the company, he said, has scaled through shop-in-shops, largely within Shoppers Stop's multi-brand retail stores, beginning with about 25 outlets and expanding gradually. Two exclusive stores are also planned in 2026.
Positioned above its two other brands, the bridge-to-luxury G-Star is expected to take on a larger role in the portfolio. “We see significant potential for it in India. Over the next three years, we expect the brand to contribute meaningfully to our portfolio, accounting for approximately 20% of our overall revenue, as we continue to scale its presence across channels,” Chhabra said.
Localization is central to this push, he said. While initial collections are fully imported, Ace Turtle plans to shift production to India over time. This is expected to deliver a margin uplift of 600-700 basis points and offer greater pricing flexibility, helping the brand expand beyond top metros.
The Bengaluru-based company also exited its Toys“R”Us business in July 2025, as it was a non-core venture facing supply-chain disruptions and other regulatory hurdles. “The toy business has a heavy dependence on imports, which disrupted the supply chain and raised costs,” he said.
Since there was no near-term recovery path, it exited after sustained losses, reinforcing its focus on core categories with stronger long-term potential.
Smaller cities, bigger contribution
A shift in geography is also reshaping the business, Chhabra said, with tier-II and -III cities now driving both growth and profitability. He said these markets account for the bulk of the company’s bottom line, aided by lower real estate costs and stronger discretionary spending. In contrast, metros are seeing a tilt towards travel, dining and experiences, slowing apparel demand.
Store expansion for Lee and Wrangler, on the other hand, will remain focused on these markets, alongside stronger online distribution and partnerships with large department store chains.
The company is also managing its brand mix to avoid overlap, with Wrangler slightly ahead of Lee in contribution and G-Star positioned as a distinct premium offering.
Operational hiccups
Even as demand improves, sourcing costs remain volatile, Chhabra said, because of rising crude-linked raw material prices and freight costs for certain G-Star imports, which will begin to strain margins. “Some of our shipments are in the UAE, but we are not moving them yet and are hoping for freight costs to settle down,” he added.
Chhabra said freight costs have surged sharply, in some cases accounting for as much as 80% of product cost, forcing shipment delays. But since it is denim, it has lower seasonality and provides some flexibility.
“Ace Turtle started with a differentiated model and a lot of promise, but over time, it has become more like a conventional retail operator. They’ve done reasonably well, but at the moment, not much stands out. In this business, scale and portfolio depth are critical. Since they are largely managing a few brands, it is difficult to build real leverage with landlords, partners or even consumers," said Harminder Sahni, founder and managing director of business management consultant Wazir Advisors.
"At the same time, denim as a category is cyclical, especially at the premium end, where you need to keep investing in brand, product and experience. So while their current strategy is steady, the next phase will depend on how they expand the portfolio and sharpen positioning,” Sahni added.
Betting on tech
Ace Turtle is also scaling its technology platform. Originally a software-as-a-service (SaaS) business, it is now deploying AI-led tools across its operations, ranging from catalogue creation and product descriptions to forecasting and in-store analytics. The SaaS vertical has also been relaunched as a standalone business.
“We see our AI-led SaaS business as a significant growth engine for the future. Over the next three years, we expect this vertical to contribute meaningfully, accounting for nearly 50% of our gross margins,” Chhabra said, adding that the company is targeting $10 million in annual recurring revenue in the near term.
It is also going to expand its reach through direct-to-consumer retail.
Regulatory filings with the ministry of corporate Affairs accessed via startup data platform Tracxn show the company’s revenue rose to ₹316 crore in 2023-24, while net loss widened to ₹56 crore from ₹13.4 crore a year ago.