1. At a Glance

ABFRL just pulled off a quarter where sales grew 9% and EBITDA jumped 38% — which sounds like a ramp walk victory until you check the net profit, or rather, net loss of ₹234 crore. Yes, the company still manages to burn cash faster than Gen-Z burns through limited-edition sneakers. The big story? The much-hyped demerger of Madura Fashion & Lifestyle (MFL) is underway, which basically means ABFRL is splitting into two publicly listed wardrobes: one for premium stitched suits and one for mass-market retail. Investors will get the same stake in both — so if you’re already drowning in losses, at least you’ll drown in style.

2. Introduction

Aditya Birla Fashion & Retail Ltd (ABFRL) isn’t your average apparel company. It’s an empire built on decades of stitching, branding, and occasionally throwing money at fancy designers who’ve never touched polyester. Born out of a corporate fashion fusion in 2015 — merging Madura Fashion, Pantaloons, and the group’s lifestyle divisions — it was supposed to be a high-margin powerhouse.

Fast forward to FY26, and ABFRL is less “powerhouse” and more “power cut.” Losses are stubborn, borrowing levels have yo-yoed, and the only thing moving fast is the number of stores they open each year. Yet, the group’s ambition hasn’t shrunk a bit. From luxury tie-ups with Sabyasachi and Tarun Tahiliani to hoarding rights for Forever 21 and Reebok India, ABFRL has tried every trick in the retail playbook — except, apparently, making consistent profits.

And now, we’ve got the demerger. Think of it as a divorce where both ex-partners get to keep the kids — and the EMIs.

3. Business Model (WTF Do They Even Do?)

ABFRL runs two main catwalks of cash burn:

a) Madura Fashion & Lifestyle (MFL)– A house of heritage menswear brands: Louis Philippe, Van Heusen, Allen Solly, and Peter England. It’s also the gatekeeper for foreign brands like Ralph Lauren, Ted Baker, American Eagle, and Fred Perry in India. Add to thatThe Collective, a luxury multi-brand retail concept, and you’ve got a segment that caters to everyone from corporate warriors to trust-fund babies.

b) Pantaloons– The fast-fashion arm that targets India’s middle-class mall-goers. Pantaloons covers men’s, women’s ethnic, western, kids, and a sprinkling of non-apparel like accessories. It’s been growing store count aggressively, but margin expansion remains as elusive as a perfect Zara sale.

Other layers of the business include:

• Ethnic Wear Empire– Sabyasachi, Masaba, Tarun Tahiliani, Shantanu & Nikhil, Aurelia, Tasva — basically every designer who’s ever been on a wedding invite list.
• TMRW Digital Brands– A