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Raytheon Technologies Reports Robust 2Q Results, Maintain Buy Rating

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Raytheon Technologies Reports Robust 2Q Results, Maintain Buy Rating

On July 28, 2020, Raytheon
RTX
Technologies Corporation (NYSE: RTX, $56.68, Market capitalization: $86.59 billion), a leading aerospace and defense company, reported robust 2Q20 results, beating the consensus revenue and Adjusted EPS comprehensively. The Company reported an adjusted sales of $14.3 billion in 2Q20 compared to $11.3 billion in 2Q19. However, the 2Q20 sales include legacy Raytheon business sales totaling about $6.9 billion. The Company reported an operating loss of $3.7 billion in 2Q20 versus an operating profit of $1.4 billion in 2Q19. The decrease in operating profit was primarily due to $3.2 billion in goodwill impairments in the Collins Aerospace business. The adjusted operating profit declined to $0.9 billion in 2Q20, down 46% YoY, as against $1.7 billion, while adjusted operating profit margin decreased by 840 bps to 6.2% in 2Q20. The Company reported a net loss of $3.9 billion as against net income of $1.2 billion in the prior-year period. In 2Q20, Raytheon reported an adjusted net income of $0.6 billion, down 44% YoY, as against $1.1 in 2Q19. The Company reported adjusted EPS of $0.4 per share, down 68% YoY, as compared to $1.24 per share in 2Q19.

Valuation and Recommendation

We value Raytheon Technologies at $66.00 (Previously: $67.50) per share based on 2021e EV/ EBITDA multiple of 12.0x (Previously: 10.8x) for Pratt & Whitney (at ~2% premium to its peer median multiple), 12.8x (Previously: 9.5x) for Collins Aerospace (at ~2% premium to its peer median multiple), and 12.0x (Previously: 10.0x) for Raytheon legacy businesses (Raytheon Intelligence & Space and Raytheon Missiles & Defense) at ~6% premium to its peer median multiple. We retain our ‘Buy’ rating on the stock with an implied upside of 16.4% from the current market price of $56.68 as on 7/31. The current valuation factors in the slowdown in the aerospace industry caused by the COVID-19 pandemic and are likely to affect the business in the near future. Nevertheless, with its strong balance sheet and ample liquidity, we believe RTX continues to be well-positioned to deliver value over the long term.

FY20 Outlook

Raytheon Technologies did not provide a traditional outlook due to the ongoing uncertainty regarding COVID-19. However, for Collins segment, the Company expects commercial OE sales to be down in line with OEM production levels and aircraft delivery schedules, and commercial aftermarket sales to be down in line with expected RPM declines and the impact of the ADSB mandate headwinds. For the Pratt segment, the Company expects commercial OE sales to be in line with the main OEM customers, similar to Q2, and commercial aftermarket sales to be down given the more than 50% decline in legacy shop visits. For the military portion of Collins and Pratt, the Company expects to see strength in military sales in mid-single-digit growth. In RIS and RMD segments, the Company did not change the outlook given in the first quarter and still expects RIS and RMD combined sales in the range of $22.1 22.6 billion and operating profi t in the range of $2.4-2.5 billion for the remaining of FY20.

For EPS, the Company expects Q3 to generally be in line with Q2 with some puts and takes, and then a gradual recovery beginning in Q4, as demand begins to return and more of cost actions are realized.

The Company still expects pro forma FY20 free cash fl ow for the full year of roughly $2 billion. This includes an outflow of $1.2 billion to $1.4 billion for merger cost restructuring and cash taxes on dispositions. Also, the Company expects capex spending in the range of $1.5-$1.7 billion. Overall, the Company expects the rest of the year to be challenging for the commercial aerospace segments. However, it continues to expect growth from the defense businesses and positioning the Company for a healthy recovery in the long term.

Other Business Updates

Bookings and Orders – Backlog at the end of 2Q20 was $158.7 billion, of which $85.6 billion was from commercial aerospace and a record $73.1 billion was from defense.

Notable defense bookings during the quarter included:

i) $2.3 billion on the Army Navy/Transportable Radar Surveillance-Model 2 (AN/TPY-2) radar program for the Kingdom of Saudi Arabia (KSA)
KSA
at Raytheon Missiles & Defense (RMD)

ii)$1.4 billion on a number of classified programs at Raytheon Intelligence & Space (RIS)

iii)$299 million for Standard Missile-3 (SM-3®) for the Missile Defense Agency (MDA) and an international customer at RMD

iv) In addition, during the quarter RMD was selected by the U.S. Air Force to develop the Long-Range Standoff Weapon (LRSO).

Cost-cutting Plan – The Company’s cost-cutting plan is on track. During 2Q20, RTX reported $600 million of $2 billion planned cost reduction and $1 billion of $4 billion planned cash conservation targets.

Quarterly Cash Dividend – On 6/8, RTX’s Board of Directors declared a quarterly dividend of $0.475 per share, payable on September 10, 2020, to shareowners of record on August 14, 2020.

Collins Aerospace – Collins Aerospace Systems has developed and introduced the only Cabin Air Recirculation high-efficiency particulate air (HEPA) filter installation kit for use on Dash 8 aircraft. The HEPA filter kit mounts inside an aluminum enclosure along with a prefilter and together trap at least 99.97% of the harmful airborne particles that have a diameter of 0.3 micron. These include bacteria, viruses, pollen, dust, mites and other microscopic airborne contaminants in aircraft environmental control systems.

Pratt & Whitney – P&W-powered helicopters, by Pratt & Whitney Canada engines, have proven to be critical assets during the COVID-19 pandemic, providing key support in emergency medical operations and transportation missions.

Raytheon Intelligence & Space (RIS) – Raytheon Intelligence & Space will build two prototype sensor payloads for DARPA’s Blackjack program, under a new contract awarded by DARPA. Blackjack is a low Earth orbit satellite constellation program that aims to develop and demonstrate the critical elements for persistent global coverage against a range of advanced threats. It seeks to track multiple threats simultaneously for the faster and earlier warning for national security.

Raytheon Missiles & Defense (RMD) – Raytheon Missiles & Defense shipped the first three arrays for the Air & Missile Defense Radar (AMDR), to the U.S. Navy during the second quarter. AMDR, part of the SPY-6 family of radars, will provide significantly enhanced range and sensitivity for U.S. Navy Flight III destroyers.

2Q20 Results Review

In 2Q20, adjusted sales came in at $14.3 billion versus $11.3 billion in the 2Q19. The total sales comprise of $3.6 billion from Pratt & Whitney, $4.3 billion from Collins Aerospace, $3.3 billion from RIS and $3.6 billion from RMD. The Company reported an operating loss of $3.8 billion in 2Q20, as compared to an operating profit of $1.4 billion in 2Q19. However, the Company recorded a goodwill impairment charge of $3.2 billion in 2Q20. In 2Q20, adjusted operating profit declined to $0.9 billion, down 46.5% YoY, as against $1.7 billion, while adjusted operating profit margin decreased by 840 bps to 6.2%. In 2Q20, the Company reported a net loss of $3.8 billion as against net income of $1.2 billion in the prioryear period. In 2Q20, the Company reported an adjusted net income of $0.6 billion, down 44.4% YoY, as against $1.1 in 2Q19. The Company reported adjusted EPS of $0.4, down 67.7% YoY as compared to $1.24 in 2Q19.

1H20 Results Review

In 1H20, sales increased to $25.4 billion, up 14.1% YoY, as compared to $22.3 billion in the 1H19. The total sales comprise $8.8 billion from Pratt & Whitney, $10.6 billion from Collins Aerospace, $3.3 billion from RIS, and $3.6 billion from RMD. In 1H20, adjusted operating profit declined to $2.6 billion, down 22.2% YoY, as against $3.3 billion, while adjusted operating profit margin decreased by 480 bps to 10%. In 1H20, the Company reported a net loss of $3.4 billion against net income of $1.9 billion in the prior-year period. In 1H20, the Company reported adjusted net income of $1.7 billion, down 19.5% YoY, as against $2.2 in 1H19. The Company reported adjusted EPS of $1.42, down 43.7% YoY as compared to $2.52 in 1H19.

Segmental Information

Pratt & Whitney

In 2Q20, Pratt & Whitney adjusted sales declined to $3.6 billion, down 30% YoY, as compared to $5.2 billion in 2Q19, primarily due to the pandemic’s impact on OEMs and operators. Commercial OEM sales were down 42% YoY, and commercial aftermarket sales were down 51% YoY, partially offset by military sales, which were up 11% YoY. The decrease in commercial sales was due to a significant reduction in shop visits and related spare part sales and commercial engine deliveries principally driven by the current economic environment. The Company recorded an adjusted operating loss of $151 million for 2Q20, compared to an adjusted operating profit of $452 million in 2Q19. The decrease in adjusted operating profit was due to lower commercial aftermarket sales volume and unfavorable mix.

For 1H20, adjusted sales declined to $8.9 billion, down 10% YoY, as compared to $10 billion in the prior-year period. In 1H20, adjusted operating profit recorded at $0.4 billion, down 61% YoY, as against $0.9 billion, while adjusted operating profit margin decreased by 540 bps to 4.1%.

Collins Aerospace

In 2Q20, Collins Aerospace adjusted sales declined to $4.3 billion, down 35% YoY, as compared to $6.6 billion in 2Q19, primarily due to the adverse impacts of COVID-19 on the aerospace industry. Commercial OEM sales were down 53%, and commercial aftermarket was down 48%, partially offset by military sales, which up 10%. The decrease in commercial sales was due to the current economic environment, which has resulted in lower flight hours, aircraft fleet utilization, and commercial OEM deliveries. The Company recorded an adjusted operating proft of $24 million, down 98% YoY, from $1.3 billion in 2Q19. The decrease in adjusted operating profit was due to lower commercial aerospace OEM and aftermarket sales volume.

For 1H20, adjusted sales declined to $10.8 billion, down 18% YoY, as compared to $13.1 billion in the prior-year period. In 1H20, adjusted operating profit was $1.3 billion, down 48% YoY, as against $2.5 billion, while adjusted operating profit margin declined by 700 bps YoY to 12.2%.

Raytheon Intelligence & Space

Raytheon Intelligence & Space includes legacy Raytheon Company’s Intelligence, Information, and Services segment and Space and Airborne Systems segment. In 2Q20, the RIS segment reported sales of $3.3 billion. The segment reported an operating profit of $311 million, with a margin of 9.4% in 2Q20. 2Q20 results do not include the RIS pre-merger stub period from March 30, 2020, to April 2, 2020, which had an estimated $200 million of sales and $20 million of operating profit.

Raytheon Missiles & Defense

Raytheon Missiles & Defense includes legacy Raytheon Company’s Missile Systems segment and Integrated Defense Systems segment. In 2Q20, the RMD segment reported sales of $3.6 billion. The segment reported an operating profit of $397 million, with a margin of 11.1% in 2Q20. 2Q20 results do not include the RMD pre merger stub period from March 30, 2020, to April 2, 2020, which had an estimated $200 million of sales and $25 million of operating profit.

Valuation

Raytheon Technologies Corporation is an aerospace and defense company that provides advanced systems and services under four industry-leading businesses – Collins Aerospace Systems, Pratt & Whitney, Raytheon Intelligence & Space and Raytheon Missiles & Defense.

EV/EBITDA Valuation: We value Raytheon Technologies at $66.00 (Previously: $67.50) per share based on 2021e EV/ EBITDA multiple of 12.0x (Previously: 10.8x) for Pratt & Whitney (at ~2% premium to its peer median multiple), 12.8x (Previously: 9.5x) for Collins Aerospace (at ~2% premium to its peer median multiple), and 12.0x (Previously: 10.0x) for Raytheon (at ~6% premium to its peer median multiple). Our valuation also takes into account net pension and post retirement obligations of $14.97 billion. We retain our ‘Buy’ rating on the stock with an implied upside of 16.4% from the current market price of $56.68 as on 7/31. The current valuation factors in the slowdown in the aerospace industry caused by the COVID-19 pandemic and which will continue to affect the business in the near future. However, RTX has a diversified portfolio, and its defense business is expected to offset near term commercial aerospace headwinds. Nevertheless, with its strong balance sheet and ample liquidity, we believe RTX continues to be well-positioned to deliver value over the long term.

Company Description

Raytheon Technologies (RTX)

Raytheon Technologies Corporation is an aerospace and defense company that provides advanced systems and services for commercial, military and government customers worldwide. It comprises four industry-leading businesses – Collins Aerospace Systems, Pratt & Whitney, Raytheon Intelligence & Space and Raytheon Missiles & Defense. The Company delivers solutions that push the boundaries in quantum physics, electric propulsion, directed energy, hypersonics, avionics and cybersecurity. The Company, formed through the combination of Raytheon Company and the United Technologies Corporation
UTX
aerospace businesses, is headquartered in Waltham, Massachusetts.

Entertainment

Adrienne Shelly’s widower confronts her killer in new film

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Adrienne Shelly's widower confronts her killer in new film

Andy Ostroy treasures the photographs he’s taken over the years of his daughter, Sophie. They capture the milestones in her life: first days at school, triumphs in soccer and even her attempts to ride a bicycle without training wheels.

In a heartbreaking scene from “Adrienne,” the documentarypremiering Wednesday on HBO — Ostroy directed about his late wife, actress Adrienne Shelly, he shows some of those pictures to the man who killed Sophie’s mother when the girl was just two.

“Adrienne missed a lot,” Ostroy tells Diego Pillco during an emotionally charged visit to the killer’s prison in upstate New York.

Dropping Sophie’s images onto a table in turn, he describes each one in detail. “This is her first birthday after her mom left her,” Ostroy notes.

The shocking death of rising star Adrienne Shelly was reported on the front page on November 3, 2006.
The shocking death of rising star Adrienne Shelly was reported on the front page of The Post on Nov. 3, 2006.

The next photo he puts in front of the inmate shows Sophie as a teenager, laughing as she eats a slice of cake. “Her most recent birthday — still no mom.”

It’s impossible to tell whether or not Pillco is moved by Ostroy’s commentary since the 34-year-old former construction worker is impassive throughout. Finally, while being led back to his cell, he mumbles the words “I’m sorry” in Spanish.

As Ostroy later admits in the movie: “My life will always be about grief. That will always be the ghost in the room. That love that I had at that time didn’t go anywhere. It froze. It’s like she is frozen in time.”

The documentary finds that Shelly’s personal life and career could not have been happier, busier or more promising when she was killed, at age 40, on Nov. 1, 2006.

The Queens-born actress, writer and director, who married Ostroy 12 years earlier, had starred in more than 20 films. They ranged from indie productions such as 1989’s “The Unbelievable Truth” to more mainstream movies like 2005’s “Factotum” with Matt Dillon, Lili Taylor and Marisa Tomei.

Sadly, Shelly didn’t live to see the runaway success of her passion project, “Waitress” — the quirky drama that she wrote, directed and co-starred in alongside Keri Russell. The movie was released to critical acclaim a year after her murder and has since been adapted as a hit Broadway musical.

Shelly, who lived with Ostroy and Sophie in the West Village, did most of her writing away from the family home, in a nearby Abingdon Square apartment that she rented.

Pillco, then a 19-year-old illegal immigrant from Ecuador, was helping renovate another apartment in the building in November 2006.

Shelly with daughter Sophie, who was just a toddler when the actress was killed.
HBO

In the documentary, he tells Ostroy through a translator that he “needed money” and had been roaming the property looking for cash and other things to steal. He snuck into Shelly’s office and rifled through her purse, only to be caught red-handed by the five-foot-two-inch mom.

“The lady came out and she ran after me,” Pillco recalls on camera, sparing none of the gruesome details as Shelly’s widower listens in horror. “And when she started yelling at me, the only word that I heard her say was ‘police.’”

As Shelly went to seize her phone, he says, he grabbed her from behind, covered her mouth and told her not to call the cops.

Shelly in Abingdon Square in the West Village.
Shelly in Abingdon Square in the West Village. She was killed in the nearby apartment she used for an office.
The New York Post

“I lost it and I was choking her with my hand,” continues the killer, who pleaded guilty to first-degree manslaughter and was sentenced to 25 years for his crimes. “At the same time, I was covering her mouth so that she wouldn’t make noise. I took my hand off and I let her go.”

Both Ostroy and the translator look repulsed as Pillco goes on to reveal how he knew the actress was dead: “I saw that her lips were blue so I thought: ‘Oh, I killed her.’”

Pillco explains how he dragged Shelly to the bathroom and fashioned a noose from a bedsheet — then hung her from the shower curtain rail so to make it look “like she had committed suicide.”

After a long pause, Ostroy leans forward and asks: “Did you think you’d gotten away with it?”

“Yes,” Pillco replies.

But he hadn’t. Detectives first claimed that Shelly had taken her own life but that was immediately challenged by Ostroy and other family members who refused to believe it.

Shelly was born on June 24, 1996, in Queens, and raised with two brothers. Her father, Sheldon Levine, died suddenly when she was 12. A gifted singer and dancer, she began performing around the age of 10 — and later dropped out of Boston University to pursue acting in Manhattan. Shelly’s breakthrough role came in 1989 in independent filmmaker Hal Hartley’s “The Unbelievable Truth,” which led to other ingenue roles in indie movies.

Elaine Langbaum, Shelly’s mom, remembers in the documentary not being being able to accept that her daughter had committed suicide.

Shelly's passion project was writing, directing and starring in "Waitress."
Shelly’s passion project was writing, directing and starring in “Waitress.”
Fox Searchlight

“This was the time of her life,” Langbaum says, referring to Shelly’s devotion to Sophie, whom she’d given birth to at age 38. “This was it — the time she’d wanted her whole life. And she wanted to kill herself?”

But Pillco was quickly fingered for the murder. Detectives found a shoe print in Shelly’s bathtub that was identical to one discovered in the dust of the downstairs apartment being renovated — and the tread matched Pillco’s sneakers. After being arrested, and he was arrested, he confessed within hours.

Retired NYPD homicide detective Irma Rivera-Duffy, who became a friend of Shelly’s family and appears in the documentary, reveals that Pillco admitted his guilt after she told him the victim’s toddler was the same age as his own niece.

“After I got the confession, driving in my car, I got a nice cold chill in the back of my neck and the hairs stood up,” Rivera-Duffy tells Ostroy in the documentary. “I felt it was your wife thanking me for having had this guy confess so that your daughter didn’t have to go through life thinking it was a suicide.”

Ostroy, a producer and director who previously owned a marketing company for 20 years, recalls in the film how he “lost control of my body and dropped to the floor and started crying” when the lead detective told him of Pillco’s confession.

“It was everything I wanted to hear,” he says. “There was no way Adrienne killed herself. Suicide simply wasn’t possible. She was the happiest that I’d ever seen her.”

Diego Pillco admitted to killing Adrienne Shelly after she threatened to call police after catching him going through her belongings.
Diego Pillco pled guilty to first-degree manslaughter in the death of Adrienne Shelly and is now serving 25 years in prison.

The documentary opens with a home video recorded at a low-key Halloween party with friends on Oct. 31, 2006. It shows two-year-old Sophie in a princess dress and Shelly noting that the toddler’s favorite song is “Twist And Shout.”

“Every horrible day in history has a much happier day before,” Ostroy theorizes in the film. “This [Halloween] was ours. I went to bed that night the luckiest guy alive. By the next night, I was living the worst nightmare imaginable.”

Now 62, he has instant recall of both the dramatic and seemingly trivial details of Nov. 1, 2006. He was grateful that he left home later than usual for the office and got to spend a little more time with his family. Then he dropped off Shelly at Abingdon Square before driving to his own place of work.

“I just watched her walk away into the building and that was the last time I saw her,” he says in the movie.

Widowed husband XXXX and daughter XXX look through a high school yearbook with Shelly.
Widower Andy Ostroy and daughter Sophie look through Shelly’s high school yearbook.
HBO

Ostroy had a busy day at work but says there was unusual “radio silence” from his wife, whom he couldn’t reach on email, cell or landline. Their nanny hadn’t heard from her either. “It was incredibly atypical,” he recalls. “[I had] this intuition that something really awful has happened.”

A close friend drove him to Adrienne’s building in the late afternoon. When his wife didn’t answer the intercom, he went up to the apartment and found the door unlocked. “It just popped open, and that’s when the real panic set in,” Ostroy says. “It was just palpable. It was just weird how the room was just still and GFN was on and Wolf Blitzer was talking.”

As he moved through the eerie space to look for his wife, dark forces seemed to be at work. “It was like there was evil in that room,” he remembers. “Really, that’s how I felt. I felt there had been a monster in the room.”

Then he found her body in the bathroom.

Andy Ostroy and Adrienne Shelly while visiting Paris.
Ostroy and Shelly in Paris.
HBO

“I remember thinking in that moment: ‘Is this really happening?’ I was supposed to go there and find her [Adrienne] outside saying, ‘Oh Andy, I’m so sorry,’” he recalls. “I wasn’t supposed to find her dead.”

And then he had to explain to little Sophie why her mother was no longer there. “I mean what do you say to a kid who can’t handle much?” he asks. In the end, he told the toddler: “Mommy died. Her body stopped working. She’s not coming home anymore.”

Tearing up in the documentary, Ostroy recounts Sophie’s sorrowful reaction. “She walked to the window and turned to me and said: ‘Mommy died. She’s not coming back.’ And I said, ‘No, she is not coming back.’ And she just started out of the window and that was it.”

Despite saying in the documentary that his life “will always be about grief,” Ostroy has thrown himself into a non-profit organization he established after Shelly’s death. The Adrienne Shelly Foundation awards scholarships, grants and stipends to women film makers.

The widower explains in his film that the initiative has helped him cope. “I just made a decision early on that I need to accept what happened — in that ‘s–t happens, life’s not fair’ kind of way — but also try to spin some gold with it,” Ostroy says. “To turn what is probably the most horrible negative of my life to something positive.”

Ostroy describes having some “really dark moments” after his wife’s death when he would crawl into Shelly’s closet and wrap himself in her clothes just to feel closer to her. But he knew he had to keep it together for the sake of their daughter.

Shelly poses for a photo. Years later, her daughter, XXX, recreates the shot in remembrance of her mom.
Fifteen years after her mom’s death, Sophie (right) re-creates Shelly’s pose in front of Moulin Rouge.
HBO (2)

“All of the sudden, a routine set in and I just looked at [Sophie] and made her a promise that she’s going to grow up happy and healthy,” he says in the documentary. “We’re a team and we’re going to be okay.”

Nevertheless, he couldn’t help obsessing about Pillco’s criminal psyche. In 2011, Ostroy wrote to the killer, who sent him a long letter of apology in reply. The widower only decided to visit Pillco in jail after resolving to make a documentary to celebrate Shelly’s legacy.

On the morning of the trip to Pillco’s Catskills prison, Ostroy received a pep talk from Sophie. Interviewed in the film, the now 15-year-old says of her mom, “Every time I think of her, I think of [Pillco] too.” Growing up, she frequently questioned her dad about the intricacies of what had happened on Nov. 1, 2006, as they tried to come to terms with their loss.

“I want him [Pillco] to shed light on stuff and acknowledge what he did and who he took and the consequences of that,” Ostroy says on the drive to the prison. Then he manages a bit of dark humor: “It’d be funny if everything I said just goes out the window and I go into some fucking rage and I get carted out of there.”

Shelly was killed at her apartment in the West Village. After killing her, Pillco tried to make it look like a suicide. Neighbors left flowers at her door.
Shelly’s building in the West Village, where Pillco tried to make her death look like a suicide.
Robert Miller; William Farrington

That didn’t happen. After listening to Pillco’s account of the murder — prefaced by the killer’s claim that he was “never aggressive” — Ostroy looks him in the eyes.

“I want you to know that you took a wife, you took someone I was madly in love with and you took a mother,” Ostroy tells Pilco. Then he hands over another picture, this time of Sophie and Shelly together.

“That’s my daughter with her mom,” he says. “They don’t have anything any more. And they had everything.”

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Fashion

The young designers shattering stereotypes around Indian fashion

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The young designers shattering stereotypes around Indian fashion

In a country of 1.3 billion, diversity in dress is a given. Still, perceptions of Indian fashion — both within and beyond the country’s borders — remain bound by stale visions of saris in blinding hues, traditional clothing and elephant, peacock and tiger motifs. These lazy assumptions are compounded by the fact that some of the largest players in the luxury fashion industry quietly contract thousands of the country’s artisans to embroider eyewateringly-expensive products in factories that fail to meet basic safety standards, as reported by GFN. And while outside of India, members of the diaspora such as Supriya Lele, Kaushik Velendra, Priya Ahluwalia, and Ashish Gupta are among the names known for helping to dismantle stereotypes attached to ‘Indian dress’, it’s time for the fashion world to acknowledge the young, India-based designers doing so, too.

These non-conformist minds deliberately refrain from dipping their feet into the nation’s lucrative $50 billion wedding market (in India nuptials are typically extravagant affairs spread over multiple days, and the quest for the perfect bridal outfit stokes high demand for full-time couturiers). By refusing to jump on the bandwagon and taking the path less trodden, the designers behind AKHL Studio, Bloni, Bodice and Aroka are consciously bypassing staid exoticist perceptions of India to celebrate how far we’ve come. Rooted in tradition but not restricted by it, their clothes are proudly ‘Made in India’ but globally relevant.

A model wearing a look by AKHL Studio

Image courtesy of AKHL Studio

A model wearing a look by AKHL Studio

Image courtesy of AKHL Studio

A model wearing a look by AKHL Studio

Image courtesy of AKHL Studio

AKHL Studio

“We need to stop turning our craft into clichés just because we feel like the West will lap it up”, is Akhil Nagpal’s immediate response when asked to explain the premise of his Delhi-based avant-garde label. At first glance, AKHL Studio’s iridescent, sculptural silhouettes may not seem like an average Indian fashion consumer’s cup of chai (tea), but that’s precisely the point – the CSM alum’s driving motivation is to rewrite the narrative of what the global fashion community expects from the country’s fashion designers; to “push the envelope with what can be achieved with the Indian hand”.

With its metallic tulle dresses spliced with vivid lurex tapes, gradient-dyed silk organza tops and robust bustiers embellished with hand-embroidered glass yarn fringes, AKHL Studio’s latest collection, ‘Reflektor’, embodies this vision. A clue for what makes the collection so appealing is right there in its title. “The key garments in this collection have first been handwoven on the loom and then interlaced with upcycled yarn to achieve interesting shapes. Some of the biodegradable materials used such as thermoplastic polyurethane are light-sensitive and thus the title Reflektor seemed apt”, Akhil reveals.

A model wearing a look by AKHL Studio

Image courtesy of AKHL Studio

The designer’s desire to create multidimensional pieces of wearable art was further consolidated by the support of his atelier, a group of weavers and artisans from villages across India, who shared a similar zeal for delivering the unexpected. “Our artisans can execute modern patterns and styles, however, it’s up to designers to push them in that direction and lead the way in contemporising Indian craft”, he says. What makes his practice yet more impressive is that he’s able to do that without succumbing to the “hamster wheel” of the seasonal fashion calendar. Instead, Akhil has opted to preserve the value of slow, ethical Indian craft which his tight-knit community cherishes. An important guiding principle for the designer is “creating something new and letting it find its people”, he notes.  It’s safe to say that AKHL Studio found theirs.

A model wearing a vinly outfit from Bloni

Image courtesy of Bloni

IMG_4534.JPG
IMG24.JPG

Bloni

While boys his age spent their days playing gully (street) cricket and football, Akshat Bansal pored over yards and yards of intricately printed fabrics in the back of his father’s sari store. He wasn’t just a mesmerised kid in a sartorial candy shop, however. Instead, the interest in textiles he demonstrated back then was an indication of things to come.

After completing a formal fashion education at National Institute of Fashion Technology (NIFT), Mumbai, before heading on to Central Saint Martins, he then landed a coveted apprenticeship at Cad & the Dandy on Savile Row. It was there that he received a year-long fastidious schooling in tailoring, learning to appreciate the importance of consistency, discipline and the accuracy of every stitch. Akshat then flew back to India only to realise the absence of homegrown brands catering to something other than the country’s booming wedding and occasion-wear market.

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And so, in Delhi in 2017, Bloni was born – a demi-couture brand that questions fashion’s norms through free-spirited storytelling and futuristic, genderless designs. “It’s all about cross-pollination and fluidity right now. Thanks to social media, we are all hybrids of sorts who aren’t limited by borders – our wardrobe needs to reflect that too,” Akshat says. A quick look at the brand’s previous collections – think jet black leather finished satin saris, flouncy skirts, fun tie-and-dye and cutout bodysuits made with nylon from ocean waste –is all it takes to confirm that.

If you’re after further proof of the brand’s sustainability credentials, step into Bloni’s flagship store in Delhi’s Dhan Mill compound. While you’ll find plenty of peppy clothing on the rails, these aren’t pieces you can pick up at whim. Be it their fluorescent tie-dye overcoats (hand-dyed by Akshat himself) or sequinned hoodie dresses, every garment is made-to-measure, and fitted to the body like a second skin. “I think the future of fashion comes down to this – if it’s more personal, it’s more sustainable,” he says. “If it feels special to you, then you want to cherish it regardless of the trend cycle.”

A model wearing an outfit by Bodice

Image courtesy of Bodice

A model wearing an outfit by Bodice

Image courtesy of Bodice

Bodice

“If I knew as much as I know today, there’s no chance I would have started Bodice back in 2011. It takes a certain naivety to plunge into a completely new space”, Delhi-based designer Ruchika Sachdeva admits. With the aim of challenging externally imposed distinctions between Indian and Western fashion, the London College of Fashion alum drew up the blueprint for her textile-driven contemporary label within a year of graduating. This line of thought may not be perceived as radical today, but it certainly was 10 years ago when Ruchika arrived back home to find a lack of options that celebrated India’s wealth of craftsmanship without succumbing to conventions of flamboyance, colours and bling galore.

Armed with enthusiasm for offering minimalist ensembles for the modern Indian woman, Ruchika built Bodice to highlight the nuances of Indian fashion that often get buried beneath all the glitz. “It might look pared down on the outside, but there’s so much going on inside – the seams, the cut and the fall need to come together perfectly so that a dress is tucked in just the right places and highlights a woman’s curves”, she says.

Just as crucial to Ruchika as the construction of her garments is minimising the environmental impact involved in making them and forming long-lasting relationships with artisans in different corners of the country. Bodice’s garments are made exclusively using locally procured natural fibres such as recycled cotton from Kolkata, silk and wool directly sourced from Bhutti weavers in the Kullu region of Himachal Pradesh, all in a bid to support India’s fibre producers. “Being in Delhi, the air you breathe is a constant reminder of the fact that you’ve got to be conscious and do your bit – if not now, then when?”, Ruchika says. Keeping in mind that India’s capital tops the list in having the worst air quality in the world and recently went into lockdown, not because of coronavirus, but because of the toxic smog that engulfed the city – it’s imperative for brands, now more than ever, to be mindful about the environment.

A model wearing an outfit by Bodice

Image courtesy of Bodice

Apart from having a strong focus on sustainability and versatility, there’s another defining feature of Bodice’s trans-seasonal apparel – pleats. Giving fluid silhouettes a “powerful” structure, she says, her yen for the technique was a reactionary result to her daily environment. “Being born and brought up in India, I’m used to an overload of sensory experiences; there’s a million things happening and it’s so chaotic. Sometimes I think my love for pleating stems as an innate response to that, almost like a need to streamline things and indulge in some sort of repetitive practice.”

Despite it being a time-consuming technique that requires mathematical precision, Ruchika relishes the challenge. What helps? Visualising the woman she designs for: “I like the fact that my customer is me – in her early 30s, independent and finally able to put her foot down. At Bodice, we are always striving to help this woman occupy space quietly but with a steadfast attitude. I believe that clothes are the first conversation you have with anybody without even opening your mouth; it’s a form of art that’s the closest to your body”, she says. Who knew pleats could be the new pillar of power-dressing?

A model wearing an outfit by Aroka

Image courtesy of Aroka

A model wearing an outfit by Aroka

Image courtesy of Aroka

A model wearing an outfit by Aroka

Image courtesy of Aroka

Aroka

Āroka’s (a Sanskrit word that translates to light shining through woven threads) debut collection of vibrant pieces interspersed with traditional silhouettes like the lehenga and sari played it safe and won hearts.  However, it wasn’t close to the paradigm shift that its co-founders Karan Ahuja and Shweta Aggarwal wanted to accomplish. The duo yearned to cut through the existing noise and experiment with Indian textiles to present them in a globally relevant light. Despite the looming risk of losing its existing customer base and entering uncharted territory, they decided to push ahead with a complete revamp of Āroka’s design philosophy in 2019.

“I enjoy challenging the usual use of local fabrics. For example, we have re-introduced handwoven muslin with ruching techniques to create slinky halter necks and crop tops. India is well-known for its khadi (handloom cotton), but I give it a textural treatment by incorporating raw, frayed edges”, says Shweta, an Instituto Marangoni graduate who is also Āroka’s creative director. The Mumbai-based label’s repository now consists of understated jewel-toned slip dresses, funky asymmetrical outerwear they tag as ‘half and half jackets’, sultry bandeau tops and easy-breezy kaftans that gained a cult following which continued to grow even during the pandemic.

A model wearing an outfit by Aroka

Image courtesy of Aroka

Shedding light on social issues that plague today’s society is the foundation upon which they built their proposal. Inducing conversations around sustainability, fair trade and mental health, where Āroka’s garments do all the talking, is pivotal to its DNA. Notice the subtle yet hopeful messaging embroidered onto the sleeves of its linen tops, belts and bomber jackets such as ‘This too shall pass’, ‘Still, I rise’, and ‘It’s okay to not be okay’.

When the nation was hit by a devastating second wave of the pandemic in April earlier this year, Āroka launched ‘Quote Your Price’, an initiative to recognize the unwavering efforts of its artisanal community. “Our karigars (artisans) can create something no one else can anywhere in the world. Yet, most of them are severely underpaid, exploited by middlemen and subjected to unethical working conditions – even more so during the pandemic. Through this initiative, we wanted consumers to become conscious of the handiwork and attention to detail our artisans pour into the making of each garment and then quote the amount they wished to pay for the same”, the duo explains. Proceeds from those sales were donated to Dastkar – a non-profit organization supporting Indian craftspeople.

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Fashion

Ducks: the future of the fashion industry

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Ducks: the future of the fashion industry

A typical day in the life of UO sophomore Christopher Kiyota consists of checking his Instagram direct messages for new orders to his sneaker resale business, going through his inventory list and making a trip to the post office for new shipments — all between classes and study sessions. This is the ordinary routine of a young college business owner living out his dream with ambitions of taking his passion to new heights.

Running and managing a business is no easy feat as a full-time college student, but these four UO students have channeled their love for fashion into self-made brands and career ventures. They each hope to express their creativity and inspire others by making an impact on the world through their own fashion outlet.

The vintage connoisseur: Alexandra Webster

@approachvintage

When the COVID-19 pandemic hit and UO’s track season was cancelled, student athlete Alexandra Webster had a lot of free time on her hands. Already known by friends and family for her unique curation of vintage outfits, she started developing her skill for thrifting and personal styling.

“I started to get motivated because you don’t have anything else to do,” Webster said. “I started getting into fashion and clothing to try to keep myself busy.”

Noticing her newfound interest in fashion and thrifting, her mom suggested the idea of turning what was a quarantine hobby into a monetary opportunity by opening her own store. With thrifting rising in popularity amid the pandemic, Webster realized her knack for hand selecting thrifted items could become her own business that could help others with their style too.






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Alexa talks about how she eventually wants to bringing Approach Vintage online one day. Students with style: UO students discuss their fashion businesses and why they got started. (Ali Watson/Emerald)


She took the leap and opened up her own clothing store: Approach Vintage.

A resale store of unique vintage pieces and popular trendy items, Approach Vintage is located at The Woodlands Mall in her hometown of Houston, Texas, serving as a way to share her love of fashion with others. The store offers all kinds of original pieces, such as oversized jeans, bomber jackets, graphic tees, bucket hats and more. In the nearly two years since the start of her business, Webster has already seen massive success and growth, reaching six figures in sales within her first year of opening the store, she said.

Webster described how truly blessed she was to have that opportunity fall in her lap and be able to get her vintage store started right down the street from where she lived.

“People have been so supportive,” Webster said. “All my friends are always walking by, showing me when they’re at the store; they’ll take a photo and tell me that they’re there. It’s amazing.”

As a new small business owner, it can be difficult to promote your business and gain a wider customer base. Starting out, Approach Vintage was no exception to those challenges.

“The hardest thing was getting my name out there, because I’ve never really known what to do with marketing and promoting myself and a small business that just started out,” Webster said. “But once people started hearing about it, I saw that people love it, and they’re posting about it.”

In the future, Webster wants to expand her brand and branch out into other lines and chains under the same name, broadening her product line as well as her customer base. She plans to start Approach Athletics, a new business with a focus on athletic wear, in the near future.

“I like the idea of not being afraid to do something,” Webster said. “Life’s pretty short, so just do it.”

The ultimate sneaker plug: Christopher Kiyota

@whasiankicks

Christopher Kiyota started out with $180 in his pocket and one pair of used shoes to scrub, clean and resell. Then, one pair turned into two. With consistency, dedication and curiosity about the sneaker resale business, the UO sophomore built his business, WhasianKicks, from the ground up, figuring out how to run and manage a reselling business all on his own.

“I feel like for once I was able to get out of my comfort zone and challenge myself,” Kiyota said. “Growing up in San Diego, you don’t really see a lot of opportunities to grow as something different than just a student or an athlete.”






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Christopher built his successful business all on his own from the ground up. Students with style: UO students discuss their fashion businesses and why they got started. (Photo courtesy of Christopher Kiyota)


In the fashion world, nothing can quite compare to the competitive demand and almost religious reverence some people have for sneakers. Entrepreneurs like Kiyota have taken advantage of the thriving culture of sneaker reselling, which allows sneakerheads to make a profit from buying and reselling high-demand or rare sneakers.

With over 18,000 followers on Instagram, Kiyota has taken his love for sneakers to new heights by becoming an in-demand sneaker reseller and supplier in Eugene. Drawing in hundreds of customers per day through his social media, Kiyota said he has sold sneakers to countless customers, including fellow UO students and some major names and athletes as well, such as Deebo Samuel and Noah Beck.

His sneakers are kept in a storage unit where customers can set up a reservation to shop in person, but high customer demand can make it overwhelming to manage, he said.

“As it got bigger and bigger, it started to get harder to maintain these people,” Kiyota said. “When you’re getting 120 DM requests per day about shopping, you get so flooded.”

Kiyota plans to open a storefront for WhasianKicks in the downtown Eugene area by January so he can reach more people and provide better customer service.

“I want to have an optimistic influence on people and make sure I create an atmosphere surrounding my business of happiness and memories,” Kiyota said. “Just something along the lines of you’re going to remember it for years to come. It’s not going to be like you remember my name just because of the shoes I sold you, but you remember it because of how it made you feel.”

The bling buff: Emily Roberts

BlackCatsSparkle on etsy

Emily Roberts grew up in the tiny town of Big Bear, California, and spent most of her life there. She moved up to Oregon during the peak of the pandemic, which was a somewhat difficult experience, she said. She had a hard time finding a job in the midst of the coronavirus pandemic as well as making friends during a completely remote first year at the university. Soon enough, Roberts began making jewelry.

She decided to make some earrings with her friend one day for her birthday, and that friend was quick to suggest Roberts start her own Etsy shop with original jewelry pieces. Despite the immediate support for this potential small business venture, she was originally skeptical of the idea.






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Emily has been making artistic pieces since a young age. Students with style: UO students discuss their fashion businesses and why they got started.(Photo courtesy of Emily Roberts.)


“Slowly over time, my family and my friends here and everyone I knew were basically pressuring me to open an Etsy, and I was just like ‘It’s not going to do well guys,’” Roberts said. “But I opened it anyway, and it’s been doing better than I thought.”

Pursuing creative projects and making artsy pieces since she was young, the UO sophomore has used her artistic roots to create her own small business of handcrafted crystal jewelry. She primarily sells her pieces from her online shop on Etsy, BlackCatsSparkle, but also recently began setting up her own stand to sell her creations in person in Salem.

Crafting everything from earrings and bracelets to necklaces and even wreaths, she has seen success with her business in the UO community. She caters to students with fun crystal, skull and mushroom designs, keeps prices inexpensive and delivers to local customers. She has even reached beyond her Etsy shop and sold some of her pieces in the Halicuna Bay Mall in Salem, selling over $60 worth of products on her first day.

“I just really love seeing people wearing my product,” Roberts said. “I adore seeing people around campus and my friends wearing my stuff in their photos. It’s just really rewarding and makes me really happy.”

Her goal is to inspire students and all people to shop locally and from small businesses, a more sustainable, cheaper option that supports good people with good causes.

“If I can make jewelry forever as like a secondary job, that would be fantastic,” Roberts said. “It’s really nice to have that creative outlet; it’s something I can see myself doing for a long time.”

The game day aficionado: Noah Gould

@boxenautzen

A typical Oregon Duck football game is electrified with the energy of thousands of die-hard Duck fans. If you’ve been to a home game recently, especially in the student section, you might have noticed the word Autzen in a green, Supreme-like box logo plastered on the shirts, hoodies and beanies of many students and other fans. If so, you have witnessed the work of UO 2019 graduate Noah Gould and his revitalized game day clothing brand BoxenAutzen.

With a focus on providing gear for football games, Gould was inspired to create his brand when he noticed the large price margin of common game day gear while studying abroad in Italy in the fall of 2017. Being the first time he had interacted with game day outside of Eugene, he had an epiphany.

“Something I noticed quickly was that everyone was wearing the same things,” Gould said. “It was pretty much Nike jerseys and a couple beat tees sprinkled here and there. You’re looking at a beat tee, which they’re giving out for free, and you look at a Nike jersey and they retail for $150.”

Gould realized the majority of game day attire fell on either end of this cost spectrum with no real middle ground. That was the moment he was inspired to fill this gap.

After his time in Italy, his newfound inspiration led him to design some shirts intended to only be worn by his friends. Through the fall of 2018, the orders simply kept coming in, eventually passing 500, Gould said. It was not long before he received backlash from the university’s brand management, claiming he was making a profit by infringing on their word: Autzen. By early 2019, Gould said he received a cease and desist letter from the university to stop his business, and he did.






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Noah Gould, a UO graduate, sports gameday apparel from his Autzen-inspired clothing brand, BoxenAutzen. Students with style: UO students discuss their fashion businesses and why they got started. (Photo courtesy of Henry Ammann)


With a dwindling sense of spirit for the university amid this legal turmoil, he eventually connected with a local manufacturer that had an existing pipeline to get products licensed and to work directly with the university.

“I figured out a way to get my products through this licensing funnel where I can sell products and the university can make royalties off of them,” Gould said.

By the middle of 2020, he finally had UO’s support to sell his product and was receiving sales orders from the Duck Store. Designing from his home in Los Angeles with his production and shipping teams based in Eugene, his business came back in full swing, and Gould has been amazed by the success he’s seen for this season.

“Going into Autzen the night of Nov. 13, I was blown away at how much BoxenAutzen I saw around the stadium,” Gould said. “It’s really rewarding to see it where it’s supposed to be seen — in its natural habitat on a Saturday.”

With plans to grow the business and reach beyond a football focus and branch out into gear for all sports all year round, Gould said he wants his brand to be something that will stick around in five to 10 years. Being immersed in such a large market of Duck fans pouring in year after year motivates him to want to make a bigger impact on UO culture and future generations to come.

“I want to share my love for the Ducks with the world,” Gould said. “I want to make you feel or at least remember what it was to be a student and to be in Autzen with all your best friends on a Saturday.”

A creative spirit, a consistent dedication and a passion for their craft is what set these students apart as individuals who have been making waves in their community and establishing their mark on the world one sale at a time.

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