Global Fashion Brands in India: H&M, Zara, and Uniqlo Show Growth

Global fashion brands, especially Uniqlo, have been making waves in the Indian apparel market, appealing to middle-class consumers who often seek styles from international labels such as H&M and Zara. This shift towards global fashion brands is attributed to rising disposable incomes, rapid urbanisation, and a growing appetite for modern and trendy clothing.

As per the McKinsey Fashion Growth Forecasts 2025, the retail revenue of luxury brands in India is expected to surpass that of the US, Europe, and China. The report predicts a year-on-year growth of 15-20% for Indian luxury brands in 2025, significantly outpacing growth rates in the US (3-5%), Europe (1-3%), and China (0 to -3%).

Uniqlo has outperformed both Zara and H&M with faster growth in India, even though it has only been operating in the country for five years, compared to Zara’s entry in 2009 and H&M’s in 2015. To understand the performance of these prominent brands, Startup Superb has examined their annual financial results for the fiscal year 2024 (FY24).

Financial Performance of H&M, Zara, and Uniqlo

Hennes & Mauritz India (H&M) took the lead with a revenue of Rs 3,278 crore for FY24, showcasing an 11.4% growth from Rs 2,942 crore in FY23. All of H&M’s earnings came from sales of apparel, accessories, and footwear, and it currently boasts 64 outlets across India.

Zara secured second place, registering Rs 2,769 crore in revenue for FY24, reflecting an 8.4% growth from Rs 2,554 crore in FY23. Much like H&M, Zara’s revenues originate from apparel, accessories, and footwear sales and it operates 21 outlets in India.

Uniqlo, which launched its first store in Delhi in 2019, achieved Rs 815 crore in revenue for FY24, equating to an impressive 31% year-on-year increase from FY23. Currently, Uniqlo operates 15 stores across India.

Expense Insights and Profitability

In their expense distribution, procurement costs comprised 42.2% of H&M’s total expenses, 70% for Zara, and 55.2% for Uniqlo. Employee benefits stood at Rs 150 crore for H&M, Rs 81 crore for Zara, and Rs 82 crore for Uniqlo.

The profit margins show Zara leading with Rs 244 crore in profit, while H&M and Uniqlo followed with profits of Rs 7 crore and Rs 85 crore, respectively. The expenses incurred for support fees and royalties towards parent entities amounted to Rs 190 crore for Zara, Rs 865 crore for H&M, and Rs 27 crore for Uniqlo.

When examining average revenue per store, H&M, Zara, and Uniqlo reported figures of Rs 51.2 crore, Rs 54.3 crore, and Rs 131.9 crore respectively.

Market Position and Brand Perception

The sales per store reflect how consumers perceive these brands, with Zara and Uniqlo being regarded as more premium options, even as they report lower same-store sales. The ‘mature’ growth rates for Zara and H&M suggest potential challenges for Uniqlo as it expands its store count in the future. Zara’s remarkably higher profits and margins indicate strong customer loyalty and brand presence, while Uniqlo has demonstrated commendable performance as well. In contrast, H&M finds itself in a more precarious position regarding its margins and brand image, as local brands such as Zudio may entice its customers. The ongoing fiscal year 2025 is expected to reveal these brands’ strengths and weaknesses more clearly. Insights suggest that Zara and Uniqlo will maintain an edge in terms of margins while narrowing the sales gap with H&M, unless H&M discovers a new growth avenue with distinct differentiation.