Quite amazed by the wealth created by Page over the past decade and also by its financial statements. Recently started tracking this company.
I think Page’s next wave of growth would come from Jockey Juniors.
If one listens to management’s commentary in Q4FY19 and Q1FY20, the management sounds a lot more exciting when they speak about the juniors segment. Some phrases used by them are “see ourselves twenty years back”, “deja vu”, “repeating the story of adults innerwear”, “pushing aggressively”, “hiring manpower”, “separate distribution network”.
Trying to estimate the market size Page can capture in this business. Page sells 10 crore pieces for each man. Assuming 6 pieces per man per year, their customer base is about 1.6 crore men. This number is close to their 20% men market share among 13 crore customers (0.2 x 13 x 0.5 = 1.3 crores). I think it should be a fair to assume that all these men would be happy to buy Jockey brand for their children.
For each adult male, we have about 0.8 children (boys+girls) according to Statista. https://www.statista.com/statistics/271315/age-distribution-in-india/
That gives about 1 crore children whom Jockey can capture from existing customer households. According to management, their total market size is about 1.55 crore children.
The interesting thing is that the ticket size for these products is higher than innerwear.
Please go through the products here: https://www.jockeyindia.com/kids/products
Most of them are about 300 Rs to 400 Rs, higher than a typical innerwear.
Even more interesting point is the number of products Jockey can potentially sell for each kid. Management assumes they sell 6 products per each man. This won’t be the same for each kid as this includes regular outerwear as well. Another funny interesting thing is that kids can be mischievous and spoil / tear their clothes leading to higher sales for kids-wear companies.
Potential market size from households which already have men wearing Jockey = 1 crore (children count) * 300 (realisation per product) * 8 (#tops + #shorts per year) = 2400 crores. I hope the assumptions made are conservative enough. Please budge in if you think something is off.
I assumed only 4 tops and 4 shorts per year because I’m not sure yet if they will have such strong brand recall in this segment as well. So I’m assuming they will buy products from other players too. Otherwise, a typical kid from Jockey-affordable households would have 10 tops + 10 shorts + 6 inner-wear. And the best part is their shelves would keep rolling clothes continuously as the children keep age-ing every year.
To put things in perspective, TTM revenues of the company are 2900 crores.
Coming to competition, there is no pan-India player in this segment. Most of the fashion brands in the country are focussed on men or women, but not on kids. The kids-wear in India is mostly sold by regional players. This can turn out to be a strong niche for the company if executed well. The company plans to price their kids-wear at 15% to 20% higher than existing regional brands.
Important challenge is that this business brings lots of designs into the inventory and hence some of it can remain unsold. I’m not sure how picky parents are while purchasing clothes for their children to assess this further. VP-ers with kids aged b/w 3-12, please comment from your first-hand experience of buying clothes for your children 
Also, this kind of hints us that the fast-line growth story for adult inner-wear in Jockey is close to end i.e. it will grow only at terminal growth rate (i.e. GDP growth rate?). One simple question is why would a rational person look very excited for a new growth avenue (Juniors) if you can see a huge growth in your existing avenues (inner-wear)? And why would you start looking for a new avenue in the first place?
However, for this story to play out, it would take some time for them to create a sizeable base. The boys segment was launched just two years ago, girls segment launched one year ago. For this to become a bit big and create a meaningful impact on the top-line would take some time. Until then, we have to keep waiting / tracking. If anyone aware of its top-line contribution, request you to share.
@People who have attended AGM, request you to share management commentary on the Juniors business.
Disclosure: No holdings. Started tracking recently.
