Reliance Retail to acquire Sephora India from Arvind Fashions

This deal gives Reliance Retail exclusive rights to build and enhance Sephora’s presence in India across channels.

Reliance Beauty and Personal Care will take over the current India operations of Sephora's 26 stores across 13 cities from Arvind Fashions, as it sets in motion a plan to expand Sephora's presence in the country.

During this period of transition, the stores and website will be operating business as usual. Reliance Beauty and Personal Care operates the beauty business for Reliance Retail and this partnership will boost its portfolio of offerings.

Reliance Retail currently has a presence in the beauty business through Tira, which it officially launched in April 2023 and now has three stores in the country and an online presence.

Arvind Fashions, on the other hand, has been looking to sell Sephora for a while now. Discussions with Reliance Retailer happened earlier as well but were reportedly called off with some reports stating that Reliance decided to go the organic way through Tira.

With this sale, Arvind Fashions will operate as a pure-play branded fashion company and will further sharpen its focus on profitably growing its five marquee industry-leading brands which include US Polo Assn., Tommy Hilfiger, Arrow, Flying Machine and Calvin Klein.

“We are proud to have scaled up Sephora India business from four stores to 26 currently, delivering one of the highest sales productivity in premium beauty in India and would like to thank Sephora for their partnership. This transaction will help AFL put capital behind growing our five high conviction brands and accelerate the journey towards higher free cash flow and return on capital employed," Shailesh Chaturvedi, Chief Executive Officer, Arvind Fashions, said.

Sephora first forayed into India in 2012, and the sale of Sephora comes at a time when competition in the Beauty and Personal Care space has been heating up. The market is currently dominated by Nykaa, while other retailers like Shoppers Stop also have been consistently expanding their presence in the beauty space. This, in addition, to several D2C brands that have rapidly grown in India, along with several global beauty brands like Shiseido, Rare Beauty, Zara Beauty, etc also looking at massive expansion in the country.

The Indian beauty and personal care market — as per Reliance Retail, is pegged at $17 billion and set to grow at an 11% CAGR — is still believed to be in its infancy; positioning India as one of the largest untapped consumer markets globally.

“We are tremendously excited to partner with the largest retail group in India to step-change our business. Rising affluence, increasing urbanisation and the proliferation of social media have driven greater awareness of self-care and beauty, unlocking major opportunities for prestige beauty. It is an opportune time for us to invest in expanding our presence, and bring new, exciting, and exclusive brands to delight our growing community of beauty enthusiasts,” Alia Gogi, Asia President, SEPHORA.

With Sephora, Reliance gets an added boost to its newly launched beauty business. However, it remains to be seen how Reliance will build and take forward both the Tira and Sephora brands.

"We are excited and proud to partner with Sephora, a global leader in beauty. The burgeoning Indian beauty market is being propelled by a new generation of customers with a strong desire to express their individuality, rising aesthetic refinement and a growing number of women in the young workforce of India. The Indian consumerism journey is at a tipping point, providing the perfect tailwind to this partnership. Importantly this partnership will help us straddle across the value chain in the beauty and personal care segment,” said V Subramaniam, Director, Reliance Retail Ventures Limited.