Myntra CEO Ananth Narayanan Steps Down
Ananth Narayanan stepped down as chief executive officer of Myntra and Jabong nearly two months after Co-Founder Binny Bansal quit following investigation into allegations of sexual misconduct.
Narayanan left Myntra to pursue, “external opportunities”, the online retailer said in a statement today. “Ananth has played an important role in making Myntra and Jabong into a formidable player in the fashion e-commerce market and steering the company towards sustainable growth,” the statement said. The company, it said, will continue to execute the growth strategy and leverage synergies with Flipkart as appropriate.
Amar Nagaram, a long time Flipkart executive, has been named as head of Myntra and Jabong, according to the statement. Nagaram will report to Flipkart Group CEO Kalyan Krishnamurthy. Nagaram has been with the group for about seven years.
The strong bench strength and new leadership at Myntra and Jabong will allow the business to continue on its strong and sustainable growth trajectory, a Myntra spokesperson said.
But Arvind Singhal, chairman and managing director at Technopak Advisors, said there will be a negative impact of Narayanan’s exit on Myntra’s strategy. “First the news of his departure has been around for a while now, and also there is a difference in the exit of founder and a professional-run CEO,” he said.
A long-time McKinsey consultant, Narayanan joined Myntra in 2015 as CEO, replacing founder Mukesh Bansal. After Walmart-backed Flipkart acquired Jabong, he’d been heading the combined entity.
The development comes months after Flipkart said it will fully integrate all functions, including technology, marketing, category, revenue, finance and creative teams, at Myntra and Jabong as it looks to restructure its fashion businesses. Walmart had said Myntra and Jabong will operate as businesses under Flipkart and Myntra’s chief Narayanan will report to Krishnamurthy. Business Standard had then reported that Narayanan plans to step down following the change in reporting structure after Bansal’s exit. Myntra, however, had said Narayanan will continue to lead the retailer.
Singhal, however, said that Myntra’s real challenge right now is to figure a way out of the foreign direct investment policy norm as it holds its own inventory and has private labels as well. That’s because the government restricted e-commerce marketplace companies from selling private labels, that is brands they directly or indirectly own, on their platforms.
“While Myntra is the market leader in fashion but being part of Flipkart, which is owned by Walmart, what kind of model is being permitted and if they can or cannot hold inventory is the biggest challenge for the entire group,” Singhal said.
Meanwhile, the company has been able to significantly narrow down its losses for the year ended March 2018. The consolidated losses for marketplace arm Myntra Designs Private Ltd. shrank to Rs 179 crore from Rs 655 crore in the year ended March 2017, according to its filings with the Registrar of Companies. Expenses, however, rose to Rs 953 crore in the previous financial year from Rs 861 crore in 2016-17, primarily due to a rise in staff costs. It’s revenue from operations grew nearly threefold to Rs 398 crore in 2017-18.