KUALA LUMPUR (Oct 25): Padini Holdings Bhd (KL:PADINI) announced plans to refurbish nine stores, open four new outlets, and close one location in Malaysia in the current financial year ending June 30, 2025 (FY2025) as part of efforts to streamline its retail operations.

The fashion retailer will also close one of its seven stores in Thailand as part of its overseas market strategy, it said in its latest annual report.

The group operates its largest market in Malaysia with over 140 stores nationwide, where inflation concerns persist amid plans to cut subsidies for RON95 petrol from the middle of next year, following a similar implementation with diesel back in June.

Nonetheless, Padini said it remains optimistic about the business’s long-term sustainability and is working to rationalise its retail operations by optimising working capital, implementing cost-control measures, and exploring additional sales channels.

Elsewhere, Padini also operates six stores in Cambodia, and has 19 franchise locations worldwide in markets including Brunei, Bahrain, Oman, Qatar, and the United Arab Emirates.

To enhance automation in its warehouse operations and address challenges related to labour shortages and inventory losses, Padini has invested over RM10 million in a radio frequency identification (RFID) system for inventory tracking and management.

RFID hardware and software have been installed at the group’s warehouse and outlets and are currently undergoing testing prior to the official launch. Padini anticipates that the project will go live in FY2025.

In addition, Padini plans to establish logistics hubs in East Malaysia as well as in the southern and northern regions to improve the efficiency of stock movement and logistics across both East Malaysia and Peninsular Malaysia.

“A warehouse which costs RM5 million in the southern region had been purchased subsequent to the financial year end [FY2024]. This development is anticipated between FY2025 and FY2029.

“The group believes these hubs will help shorten lead times for stock transitions, improve top line growth and reduce carbon emissions,” Padini added.

While the group remains focused on its brick-and-mortar operations, it said it has dedicated significant efforts to expanding its online business. This includes enhancing product awareness across its online channels and upgrading the infrastructure for e-commerce.

Its brands — such as Seed, Miki, Vincci, Padini Authentics, and BO Accessories —  are also available online through its e-commerce platforms in Malaysia and Singapore.

“Developing new online shopping experiences and enhancing shopping convenience to our consumers is a continuous effort of the e-commerce division. We believe digital retailing of the group will bring a positive impact to the group both as a complementary business channel and for future growth,” it said.  

Shares of Padini were unchanged at RM3.44 as of 2.47pm on Friday, valuing the group at RM2.26 billion.