D2C Apparel Brand Reports Strong Revenue Growth in FY25
D2C apparel brand The Souled Store recorded a solid rise in revenue during FY25, reflecting the continued demand for licensed merchandise and direct-to-consumer fashion in India. The company’s operating revenue increased by 37 percent to ₹492.4 crore, driven almost entirely by product sales across its online platforms and expanding offline presence. This growth highlights how consumer interest in branded lifestyle apparel remains strong despite a competitive retail environment.
However, while revenue moved upward, profitability faced pressure. Net profit declined to ₹11 crore in FY25 compared to over ₹17 crore in the previous year. The drop was mainly due to higher tax outgo and increased operational costs as the company scaled its business. Total expenses climbed close to revenue levels, showing that growth came with tighter margins.
Founded in 2013 and incorporated a year later, The Souled Store started as a small online T-shirt business backed by personal savings of ₹5.5 lakh from its four founders. Over time, it expanded its product range to include hoodies, footwear, accessories, and lifestyle items. Today, the brand serves more than eight million customers through its website, mobile app, marketplaces, and over 40 physical stores across India.
D2C Apparel Brand Expands Through Scale, Stores, and Licensing
D2C apparel brand growth in FY25 was supported by consistent daily order volumes ranging between 15,000 and 20,000 units. The company also benefited from a higher average order value and the addition of new offline stores, which helped strengthen brand visibility beyond digital platforms. Despite having physical outlets, over 90 percent of total revenue still came from its website and app, reinforcing its strong direct-to-consumer focus.
A major strength of the brand lies in its licensed merchandise portfolio. The company holds rights to over 200 global intellectual properties, including well-known names from entertainment and pop culture. These licenses allow the brand to continuously refresh its offerings and attract younger customers who seek familiarity and identity through apparel.
In April 2025, the company acquired Redwolf, another known name in the merchandise space. This acquisition is expected to widen product variety and deepen reach among niche fan communities. Alongside this, The Souled Store continues to expand its offline network, with plans to add more stores over the next two years, indicating confidence in long-term consumer demand.
From a funding perspective, the company has raised close to $30 million across multiple rounds. The largest investment came in 2023, providing capital support for expansion, inventory buildup, and brand development. This funding has played a role in sustaining growth, even as costs rise alongside scale.
D2C Apparel Brand Faces Margin Pressure Amid Rising Costs
D2C apparel brand operations in FY25 also reveal the cost challenges that come with rapid expansion. Total expenses rose to ₹487.5 crore, leaving little gap between income and spending. Inventory costs alone accounted for around 43 percent of total expenses, reflecting the capital-intensive nature of apparel retail. Employee costs, logistics, marketing, rent, and marketplace fees also increased as the company scaled operations.
Despite these pressures, profit before tax improved to ₹12.8 crore, and EBITDA margin remained steady at 9.7 percent. Return on capital employed stood at 7 percent, indicating moderate efficiency but also room for improvement. Revenue growth over the past three years shows a steady upward trend, rising from ₹233.5 crore in FY23 to ₹360.2 crore in FY24 and nearly ₹500 crore in FY25.
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This financial pattern suggests that while demand is strong, maintaining profitability will depend on tighter cost control and operational efficiency. As competition in the D2C fashion space intensifies, balancing expansion with sustainable margins will be critical. Also Read: Tomorrow X Together Taehyun leaves a lasting mark on cross-cultural music stage in 2025
Conclusion
The D2C apparel brand story of The Souled Store reflects strong consumer demand supported by scale and licensing strength, while also revealing the financial pressure that comes with rapid growth. How the brand manages costs alongside expansion will shape its next phase.
