The days of luxury and premium brands ruling the Indian market are fading fast. Now, it's all about affordable, trendy fashion that's capturing the hearts of millions. With budget-friendly branded apparel and footwear on the rise, major retailers are racing to expand into this booming segment, targeting smaller cities and towns where consumer dreams are skyrocketing. Get ready for a retail shakeup like never before!

India's value retail segment has witnessed unprecedented growth in recent years, driven by several key factors. Increasing disposable incomes, especially in non-metro areas, have empowered consumers to seek branded fashion at affordable prices. According to a report by Motilal Oswal Financial Services Ltd., the value apparel segment is projected to experience a compound annual growth rate (CAGR) of 6 percent from 2020 to 2025, with the organized sub-sector expected to achieve an even more impressive 13 percent CAGR. India's value-fashion market has traditionally been dominated by unorganized retailers, accounting for 57 percent of the total apparel market. This segment mainly caters to middle and lower-income groups in Tier II and smaller markets. Despite the potential, only a few regional retailers have established a foothold in this budget-conscious sector, which has been difficult for larger retail players to enter.

“The value apparel segment is experiencing a phenomenal rise due to several key factors. Economic fluctuations have made consumers more budget-conscious, leading them to seek affordable yet stylish options. Advances in manufacturing have improved the quality of value apparel, aligning it more closely with consumer expectations. The rise of e-commerce and omnichannel retail strategies has made these products more accessible, while targeted marketing and influencer collaborations have boosted their appeal. This combination of affordability, quality, accessibility, is driving the remarkable growth in the value apparel segment,” shares a Yousta spokesperson

Zudio, a value retailer by Trent Ltd., has been a frontrunner in this movement, setting the benchmark for others to follow. Zudio’s success in urban markets has prompted national retailers like Yousta, Style-Up, and InTune to enter the fray, aiming to replicate its model of offering high fashion at low price points. As the value fashion segment continues to evolve, it’s becoming clear that this is not just a trend but a fundamental shift in the Indian retail landscape.

Max Fashion, a leader in the value fashion space, has also set its sights on expanding its reach in India. With over 500 stores and a presence in 200+ cities, Max Fashion is committed to “democratizing fashion” by offering global trends at affordable prices. The brand’s recent launch of Max Urban, designed for the youth market, further underscores its focus on catering to the aspirations of younger consumers. Now, they have partnered with Bollywood star Alaya F to launch a fresh collection that's all about youthful vibes and bold self-expression under its newest brand – Urb_n. The launch of Urb_n is a strategic move that leverages Max's established presence in the Indian market. By introducing this youth-centric brand, Max aims to connect with the 17-22 age group, bridging the gap between its current offerings and the preferences of younger consumers. This expansion not only strengthens the brand's appeal to a younger demographic but also enhances its competitive edge in the trendy, fast-fashion segment.

Beyond Metros

The heart of the value retail boom lies in India's Tier II and Tier III cities. These markets, previously dominated by regional and local operators, are now the new battleground for national brands. With better demographics, higher incomes, and rising aspirations, consumers in these cities are seeking more than just affordable clothing—they want branded, trendy options that reflect their evolving tastes and lifestyles.

“Tier II and III markets in India have always had the aspiration for branded fashion, but the challenge was availability,” explains Anand Ramanathan, Partner and Consumer Products & Retail Leader, Deloitte India. “As more brands open exclusive outlets in these markets, we are seeing a significant shift. Consumers no longer need to rely on e-commerce platforms; they can now access these brands directly in their cities. This availability, coupled with disposable income, is bridging the gap and driving growth in the value segment.”

Zudio: The Flagbearer of Affordable Fashion

Zudio has been at the forefront of India’s value retail revolution, expanding rapidly since its inception in FY17. With over 545 stores across 161 cities, Zudio has become synonymous with affordable fashion in India. The brand's strategy of minimizing lead times and ensuring fresh collections reach stores quickly has been a game-changer. The brand’s ability to sell trendy apparel at unbeatable prices has resonated with consumers across the country, especially in smaller cities where fashion choices were previously limited.

“Zudio's proposition of offering high fashion at low prices, particularly targeting the youth segment, has been a significant differentiator,” notes a report by Motilal Oswal. “While regional retailers cater to lower middle-class families with a wider range of products, Zudio's focus on trendy, affordable fashion has set it apart, making it a formidable competitor in the value retail space.”

Yousta and the Rise of Youth-Focused Value Retail

Following in the footsteps of Zudio, Reliance Retail’s Yousta has emerged as a strong contender in the value retail segment. Launched in August 2023, Yousta has rapidly expanded across India, with stores in Maharashtra, Telangana, Chhattisgarh, Kerala, Tamil Nadu, Jharkhand, West Bengal, and Uttar Pradesh. The brand’s focus on catering to young shoppers with trendy, affordable ensembles has struck a chord, particularly with its “Starring Now” collection, where most items are priced below Rs 499.

“Yousta's strategy is simple yet effective — be where the consumers are,” says a Yousta spokesperson. “Our consumers are not only within metropolitan boundaries, but in smaller cities and towns. We have always been connected with our consumers. Leveraging comprehensive market research and understanding the unique preferences and needs of consumers in Tier 2 and Tier 3 cities enables us to bring our offerings to them. Our distribution networks ensure that our products are accessible and available in these regions.

Their superpower and part of their core identity lies in their dedication to their consumers, helping them celebrate their most authentic selves and express themselves in the best way possible. They achieve a balance of economical pricing and high quality through strategic sourcing, efficient production processes, and a commitment to continuous innovation. Their production processes are designed for efficiency and waste minimization, with a strong focus on optimizing supply chain management. By enhancing logistics and distribution networks, they reduce transportation costs and ensure timely product delivery. Innovation is a crucial aspect of their cost-control strategy, as they continually explore new materials, designs, and manufacturing techniques that enhance quality while remaining cost-effective. Their design team is skilled at creating versatile, timeless pieces that maximize value for their customers.

New Players in a Growing Market

Aditya Birla Fashion and Retail’s Style-Up and Shoppers Stop’s InTune are also making waves in the value retail segment. Style-Up, with its trend-driven designs and competitive pricing, is aimed at the youth market, offering a wide array of apparel and accessories. With 30 stores across India and plans to expand further, Style-Up is positioning itself as a fashion-forward destination for young consumers.

InTune, from the stables of Shoppers Stop, has already made significant strides, adding 9 stores in the last quarter alone, bringing its total to 31 stores across 14 cities. The brand’s focus on full-price sell-through and strong conversion rates underscores its commitment to maintaining high standards of quality while keeping prices affordable. InTune’s expansion plans for FY25 indicate that the brand is set to intensify its presence in the value retail segment.

Growth and Expansion

As the value retail segment continues to grow, the future looks promising for brands that can strike the right balance between affordability and quality. Anand’s analysis points to a continued shift towards value spending, particularly in the wake of the post-pandemic economic environment. While luxury and premium segments may see slower growth, the value segment is expected to drive major growth in the near term, especially in Tier II and III markets.

The rise of value retail in India marks a new era in the country's fashion industry. As large retailers continue to expand their footprint into smaller cities and towns, the availability of affordable, trendy fashion is set to increase, meeting the demands of a rapidly growing consumer base. Brands like Zudio, Yousta, Style-Up, and Max Fashion are leading the charge, redefining what it means to shop in India. With strategic expansions, innovative product offerings, and a deep understanding of local consumer preferences, these brands are not just surviving — they’re thriving.