MARKETING 2018-19 10th MARCH 2018 BRAND AND MARKETING

Current Brand Registration CONVERSION REMAINS WEAK LINK Future Disposition Current Brand Registration Total Awareness Purchased L6M Future Consideration Most Preferred W1 W2 70 80 19 W1 W2 47 9 7 Fabindia 27 23 18 14 Lifestyle 99 98 68 61 90 87 35 29 69 62 39 34 Shoppers Stop 98 97 63 56 90 87 26 25 64 58 29 28 Biba 83 87 29 32 62 58 13 15 34 37 20 25 As seen earlier, brands like Lifestyle, Shoppers stop and Biba lead Fabindia on awareness (both unaided & total) and the same effect is seen on recent purchases and future consideration. Source: Brand Track Wave 1 & 2 (GFK), May & Nov’17; Base: All (820); Age group 25 – 45 yrs

FABINDIA WEAK ON IMPORTANT DRIVERS Of 11 attributes which are key to driving consideration and/or preference, Fabindia is positively differentiated on only 2 On design, fits and prices we are undifferentiated if not slightly negative in the minds of consumers, compared to competition   Fabindia Lifestyle Shoppers Stop Biba Westside Khadi India Good quality fabric -1 4 1 2 -3 Variety of fit options -2 3 Unique design Clothes only made from natural products -7 6 Right fit For stylish people -4 Offers just right prices For those proud of traditions -6 Hand-crafted/ Traditional skills 8 Cordial/ helpful store staff -5 New range regularly Relatively important driver for both Consideration & Preference Relatively important driver for Preference Relatively important driver for Consideration Source: Brand Track Wave 1 & 2 (GFK), May & Nov’17; Base: All (820); Age group 25 – 45 yrs

58% respondents have issues with price RETAIL BROWSERS ARE NOT WILLING TO PAY OUR PRICES 58% of respondents have an issue with pricing 46% say garments are expensive / overpriced for the offering Price perceptions of being “expensive” are reflecting across genders & ages (see table on left below) South is far more price-sensitive than the rest of India (see table on right below) 58% respondents have issues with price Base: All respondents (5,740) Figures in % Any issue on price Base  5,740 Less than 18 years 58 18 – 25 years 26 – 35 years 36 – 45 years 55 46 – 55 years 60 56 years and above 63 Figures in % Any issue on price Base  5,740 North 58 South 67 East West 50 Base: 3,779 responses citing Price; multiple selections possible Base: All respondents (5,740) Source: In-store Browsers (Non-Shoppers) Q’re Wave 2, Dec’17; Question 5 on Pricing

THEY FIND OUR COLLECTIONS LACKING VARIETY / FRESHNESS 47% of consumers say they don’t find enough variety A further 12% complain about a lack of freshness No difference in demand for Contemporary vs Classic silhouettes. No differences seen across age groups either (refer table below). This ‘lack of variety’ seems to be about the difficulty in Discovery at our stores + us being benchmarked against ever-increasing design variety at other brands 55% respondents have issues with Product Base: All respondents (5,740) Base: 2,660 responses citing Design/Style; multiple selections possible Figures in % All Seeking Contemporary Styles Seeking Classic Styles Base  5,740 468 614 Less than 18 years 1 18 – 25 years 12 13 11 26 – 35 years 39 40 42 36 – 45 years 31 32 28 46 – 55 years 56 years and above 4 3 5 VERBATIMS “You mostly get to see the same colours” |“Same options are displayed every time” | “Do not repeat the same designs” | “I want the latest designs” Base: All respondents (5,740) Source: In-store Browsers (Non-Shoppers) Q’re Wave 2, Dec’17; Question 1 & 2 on Design & Style + Fits & Sizes

55% respondents have issues with Product THEY DIDN’T FIND THEIR SIZE IN WHAT THEY LIKED 32% said they didn’t find their size though they liked a product – size set issues. This is a loss of sale that could be plugged quite quickly. 22% are unhappy with the sizing / fits - body block issues Demand for “Slim Fits” is higher (27%) than that for “Regular Fits” (19%) – a new reality that is also reflecting in the wider market The choice of Slim Fit is higher across most age groups (refer table below) 55% respondents have issues with Product Base: All respondents (5,740) Figures in % Seeking Slim Fits Seeking Regular Fits Less than 18 years 13.4 9.8 18 – 25 years 13.8 4.1 26 – 35 years 12.7 7.8 36 – 45 years 10.6 7.9 46 – 55 years 7.2 9.6 56 years and above 9.5 Base: 2,340 responses citing Fits/Sizes; multiple selections possible Base: 2,340 responses citing Fits/Sizes; multiple selections possible Source: In-store Browsers (Non-Shoppers) Q’re Wave 2, Dec’17; Question 1 & 2 on Design & Style + Fits & Sizes

18% respondents have issues with Store STORE DISPLAY MAKES DISCOVERY & SHOPPING DIFFICULT 18% respondents have an issue with either store display or experience 36% respondents said that there was not enough hanging display – this has a direct impact on how much variety they see at first glance 26% found it difficult to locate what they wanted with a further 17% saying the shelves were too crowded There is no difference between the Female & Male respondents meaning that for all garment categories, store layout needs to be looked at 18% respondents have issues with Store Base: All respondents (5,740) Figures in % All Female Male Base  674 457 217 Not enough hanging display 36 37 Difficult to locate what I want 26 27 24 Layout & navigation is confusing 20 19 21 Shelves are too crowded 17 18 Base: 678 responses citing Store Display; multiple selections possible Base: 678 responses citing Store Display; multiple selections possible Source: In-store Browsers (Non-Shoppers) Q’re Wave 2, Dec’17; Question 6 & 7 on Store Display + Store Experience

YOUNGER, CURRENT NON-USERS, ARE UNFAMILIAR WITH FABINDIA 1/3rd of the consumers have stated that they know the brand only by name Causing misattribution of some categories & lack of awareness of others e.g. Males claim FI sells t-shirts & jeans e.g. OF PC are very low in awareness 29% feel we are “overpriced” 26% say there’s no store close to them – our presence online could help their distribution concerns, considering ~50% of both genders shop online Source: Aware Non-Trier Quant research, Oct’17; Base: 3,583 respondents; Age group 22 – 35 yrs

Bottlenecks: Brand, Product, Price & Retail SUMMARY : REASONS FOR NON-PURCHASE CURRENT CUSTOMERS Brand Track, Needscope, CWC, Store-administered VISITORS – BROWSE BUT NOT SHOP Internal/Store-administered; Sample: 5,740 AWARE, NON-CUSTOMERS External/GFK; Sample: 3,883, 22-25/26-30/31-35 Bottlenecks: Product, Price & Retail #1. BRAND: None #2. PRODUCT: Design predictability, innovation, Not contemporary / “On-Trend”, Silhouettes, Size (availability, non-standard) #3. PRICE: Overpriced & not value for money #4. RETAIL: Crowded shelves, “very mass”, Navigation, non-uniform product assortment Bottlenecks: Product, Price & Retail (80%) #1: BRAND: None #2: PRODUCT: Variety + freshness (38+6%), Size availability (13%), Fits (Slim) (19%), Non-standard sizing (4%) #3: PRICE: Discounts (36%), Overpriced for what is offered (28%) #4: RETAIL: Hanging displays (4%), Difficult to locate (3%), Crowded shelves (2%), Navigation (2%) Exchange policy (8%), Staff quality (2%) Bottlenecks: Brand, Product, Price & Retail #1: BRAND: Low familiarity – don’t know what the brand stands for; Only legacy knowledge (33%) #2: PRODUCT: Variety + freshness (14+10%), Innovation (11%), Silhouettes (10%), Size availability (11%), Fits (Slim) (10%) #3: PRICE: Overpriced for what is offered (29%), Buy other brands cheaper (20%), Discounts (18%) #4: RETAIL: Lack of store close by (26%)  Stores not located in high-visibility locations with malls & on high streets Bottlenecks: Product, Price & Retail Bottlenecks: Product, Price & Retail Bottlenecks: Brand, Product, Price & Retail