Mukesh Ambani-owned Reliance Industries' retail arm, Reliance Retail is in advanced talks for the India rights of beauty retailer Sephora, two people familiar with the development said.
The move could see Sephora operations transfer from Arvind Fashions Ltd., its current partner, to Reliance Retail. Arvind Fashions holds Sephora’s master franchise rights for India.
Reliance Retail did not comment on queries. An email sent to Sephora globally did not elicit a response.
Sephora is a French multi-brand beauty products chain owned by the world’s top luxury goods retailer LVMH Moët Hennessy Louis Vuitton. Arvind Fashions Ltd. operates brands such as USPA, Tommy Hilfiger, Flying Machine, Arrow, Calvin Klein and Sephora in India.
According to Arvind Fashions Ltd’s FY21 annual report, Sephora has 24 stores in India in 12 cities. Globally, the beauty retailer known for retailing premium cosmetics and perfumes such as Bobbi Brown, Benefit Cosmetics, Lancome, etc is present in 35 countries with over 2,700 stores.
The move comes as Reliance Retail sets its eyes on the beauty and personal care market in India after dominating the apparel retail segment in the country. India’s beauty retail market is expected to reach ₹2 trillion by 2025 driven by a higher propensity to shop online owing to increased internet penetration as well as a large millennial and gen-Z populations with aspirations and growing disposable incomes, Motilal Oswal Financial Services Limited (MOFSL), said in a 2021 report.
Reliance Retail is also inclined towards a multi-brand beauty retail concept for more mass market brands that will compete with the likes of omni-channel beauty retailer Nykaa.
To be sure, Sephora has had a string of associations in India as it has tried to cement its position in the country’s beauty and personal care market. Prior to its 2015 tie-up with Arvind, Sephora’s rights rested with DLF Brands—the retail arm of real-state company DLF Ltd. Its operations were also managed by New Delhi-based Genesis Colours. The tie-up however was strained in 2013.
In response to queries on Sephora, a spokesperson for Arvind Fashions said, “As per company policy, we do not comment on market rumours and speculations,"
Those in the know of the development said that a transition to the new partner is “underway" and will come about in a couple of months. “The move could also signal the retailer’s attempt at understanding and managing the premium beauty market in India," said the person who did not wish to be quoted.
Earlier this year, Reliance Retail Ltd also signed a long-term franchise agreement with American apparel major Gap Inc., after the latter terminated its franchise agreement with Arvind Lifestyle Brands in 2021.