Virat Kohli's Direct-to-Consumer (D2C) fashion brand, WROGN, has reported a significant increase in its net loss for the fiscal year 2025. The net loss widened by 32% to Rs 75.5 crore, compared to Rs 56.8 crore in the previous fiscal year. This deterioration in profitability occurred as revenue from operations fell by 9% to Rs 223.2 crore, marking the second consecutive year of revenue contraction, following a 29% drop in FY24. Despite the decline in sales, the company's total expenses saw a 2% increase, rising to Rs 312.6 crore from Rs 306.4 crore in FY24. Key drivers of this expense increase include employee benefit expenses, which climbed 21% to Rs 38.9 crore, and a substantial surge of 63% in advertising and promotion spending, reaching Rs 49.2 crore. Commissions paid to selling agents also rose by 29% to Rs 40 crore. As a result, accumulated losses for WROGN have mounted to Rs 709 crore as of March 2025. The brand has also seen recent investment, with Aditya Birla Group's TMRW House of Brands investing Rs 125 crore (approximately $15 million) in June 2024 and an additional $9 million in October. Aditya Birla Digital Fashion now holds a 32.8% stake in WROGN.
Heading: Difficult Terms
D2C: Direct-to-Consumer, meaning a business sells its products directly to the end customer without intermediaries.
Net Loss: The total amount of money a company loses after all expenses are subtracted from its revenue.
Revenue from Operations: The income a company generates from its primary business activities, excluding other income sources.
Registrar of Companies (RoC): A government office responsible for the registration and administration of companies.
Accumulated Losses: The total cumulative losses a company has incurred over its operational history that have not been offset by profits.
Heading: Impact
Rating: 5/10
This news highlights the financial challenges faced by D2C fashion brands, potentially affecting investor sentiment in the sector. Companies like Aditya Birla Group, which invests in such brands, may face increased scrutiny on their portfolio performance. It signals a potentially difficult operating environment for direct-to-consumer fashion businesses struggling with profitability, which could influence investment decisions and market valuations for similar companies in India.