Q1 online sales may outpace offline in food, fashion categories: ICICI Securities

economictimes.indiatimes.com:

Zomato as well as omnichannel beauty and fashion retailer Nykaa to arrive at this conclusion. “As noted in Q4FY23 (January-March 2023), we believe (the) consumption slowdown continued in Q1FY24E (April-June 2023) in most business-to-consumer (B2C) consumption categories. We think this is due to sustained consumer inflation and its impact on disposable income as ‘return to office’ continues to be implemented across the country.

However, online commerce seems to be faring better than offline,” the report, dated July 10, said. Both Nykaa and Zomato are yet to report their June-quarter earnings. On July 7, Nykaa had informed the stock exchanges that its fashion vertical is “expected to grow in the low to mid teens on YoY basis” in net sales value (NSV) terms for the June-quarter.

In retail, NSV is the sum of a company's gross sales minus its returns, allowances and discounts. “This, we think, is higher than the growth rate for the apparel segment and could indicate share gains for online fashion,” said the brokerage firm. ICICI Securities pointed out that most apparel retailers had been struggling to increase their revenues in the first quarter of FY24, while Nykaa is estimated to lift its fashion revenues by 11% year on year.

Additionally the ICICI Securities report noted that Zomato is expected to outpace most quick-service restaurants (QSRs) “on a like to like basis”. The brokerage firm expects Zomato to record 9.2% year-on-year growth in its food-delivery gross order value (GOV), and 6.8% growth sequentially. Listed players in India’s QSR space include Jubilant Foodworks, which operates Domino’s Pizza and Dunkin Donuts outlets; Devyani International, which runs the franchisees of Yum Brands restaurants such as KFC, Pizza