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New Delhi: Reliance Brands Ltd (RBL), a unit of Reliance Industries Ltd, has agreed to buy a 40% stake in MM Styles Pvt. Ltd, owned by homegrown designer Manish Malhotra. This makes it one of the most prominent investments by Reliance Brands in the luxury ethnic wear market though the company did not disclose the deal size.

Reliance Brands plans to help drive growth for the 16-year-old couture label in India and overseas, and establish the Manish Malhotra brand as a global couture powerhouse, the company said.

The two will expand the brand into a “larger lifestyle consumption portfolio" and grow into other adjacent categories while retaining the brand’s positioning in the occasion and wedding wear market.

The brand will continue to be led by Malhotra as the managing and creative director.

Malhotra, a self-taught designer, found his calling designing costumes for blockbuster Bollywood films.

Over a career spanning three decades, Malhotra established himself as Hindi cinema’s leading costume stylist and luxury couturier.

“This is the first external investment for the brand, which had so far been privately held by the designer," the companies said in a joint statement.

Currently, Malhotra runs four flagship stores in the country, apart from two shop-in-shops.

The move marks a shift in Reliance Brands’ strategy. After 14 years of bringing global premium and luxury Western brands in India, Reliance Brands will now focus on homegrown designer labels, it said in the statement.

“As upcoming consumption power steadily moves from west to east, the fashion and design sensibilities are not far behind. Recognising these winds of change, Reliance Brands, in its next wave of value creation, is setting its sight towards homegrown talent rooted in Indian design sensibilities," it said.

Reliance Brands houses more than 60 brands, a bulk of them international, and has a retail footprint of 595 stores and 744 shop-in-shops in India.

Its portfolio comprises largely foreign brands such as Brooks Brothers, Burberry, Hamleys, Hugo Boss, Hunkemoller, Iconix, Jimmy Choo, Kate Spade New York, Michael Kors, Steve Madden, Superdry, Scotch & Soda, Tiffany & Co., and Tory Burch.

Satya Paul is also part of its portfolio. It is also invested in Indian menswear designer Raghavendra Rathore’s eponymous label.

Investment in Malhotra’s company, which sells pricey Indian outfits that have been worn by India’s rich and famous, will entail expansion both in India and overseas markets to cater to the diaspora.

Besides physical retail expansion, the partnership will create a strong technology backbone for the business while developing omnichannel and experiential e-commerce opportunities.

“Malhotra’s brand has a significant cache of current and potential consumers across global fashion capitals and onward plans include expansion both in India and international markets," the two said.

Malhotra said the brand will come up with a lot more diversified looks and collections in multiple brackets.

“We are not going very pret, of course, but keeping the essence of high luxury," he said.

The pandemic has also disrupted the country’s fashion market—this is especially true for the occasion and formal wear, leading to consolidation. Malhotra said consumers are also more experimental and willing to express their individuality through their own sense of style, giving designers the room to experiment.

In FY20, rival Aditya Birla Fashion Retail Ltd acquired Jaypore, a craft-based artisanal brand, apart from investing in designer duo Shantanu & Nikhil to tap into the occasion wear market.

In FY21, Aditya Birla Fashion invested in designer Sabyasachi Mukherjee, apart from an investment in Tarun Tahiliani’s label.

Corporate backing of fashion brands in India was long overdue, Malhotra said.

“For organic fashion brands to grow, corporate backing is essential. It’s been proved all over the world," Malhotra said in an interview with Mint.

Besides, despite the popularity of western brands such as Zara and H&M in India, most of the women’s wear market still rests with ethnic wear brands.

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