Retail Sector Q3 Earnings Preview: Festive Season Expected To Revitalise Recovery Rates, Says ICICI Direct

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ICICI Direct Report

We expect revenue recovery rates of fashion and lifestyle retailers to perk up in Q3 FY21E to 65-75% from 45-55% in Q2 FY21.

In October-November recovery trajectory improved to approximately 75% owing to strong pent-up demand driven by festive buying.

Various retail players indicated that tier-III and IV towns saw positive YoY growth in November.

Furthermore, online sales gained robust traction with sales tracking 1.5-2 times pre-Covid-19 levels, supported by a low base.

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