Value fashion players in the apparel industry outperformed the broader textile retail sector in the second quarter, supported largely by the early onset of the festive season, according to a report by Nuvama Research.
The report noted that apparel companies delivered a mixed set of results in Q2 FY ’26, with value fashion brands emerging as the strongest performers. Their growth was attributed primarily to the earlier-than-usual arrival of the festive period this year, particularly the Durga Puja season.
According to the report, apparel companies had “reported a mixed bag of results, with value fashion players outperforming the lot, driven by an early festive season this year”.
The early festival timing lifted demand across retail stores, resulting in higher footfall and improved conversions, especially in eastern markets where value-focused retailers hold a sizeable presence. This translated into strong revenue growth and elevated same-store sales growth (SSSG) for these companies.
Premium apparel brands also posted respectable like-to-like (LTL) growth across categories, supported partly by ongoing store rationalisation efforts.
Footwear companies, meanwhile, continued to follow trends consistent with previous quarters, with no major deviations reported.
The study further observed that the GST rate cuts implemented towards the end of Q2 FY ’26 have yet to reflect in sectoral performance. Their impact is expected to become more evident from Q3 FY ’26 onwards. However, the GST rate rationalisation, effective from 22nd September, temporarily disrupted supply chains and prompted several companies to destock wholesale channels, resulting in short-term operational challenges.
Despite the festive-led boost, the apparel sector also encountered localised disruptions. Unseasonal rainfall in key Pujo markets such as Kolkata and parts of the Northeast, along with political disturbances, slightly tempered shopping activity during the quarter.
Overall, the early festive season drove a lift in apparel demand in Q2 FY ’26, helping value fashion players outperform even as the industry contended with cautious consumer sentiment and temporary GST-related disruptions.
Sharing its outlook, the report stated that management teams across the sector remained confident that the second half of the year would outpace the first, supported by the wedding season and an anticipated recovery in demand.
