Pondering on the questions, I can definitely conclude upon how ABG taught me a very good marketing lesson.
My uncle owns a utensils shop by the name 'Cookware' in his city. The business was doing well, and he decided to open another one in his city. The shops performed amazingly well for 4 years and he was about to open a third shop but an idea struck him. He thought if people pay Rs X for it, maybe a few will pay Rs. 2 X for better quality and ambiance. (Yes, footfall will be lower but margins way too high). Moreover if he won't open it, someone else will. So he was about to open the third shop but his friend suggested that people associate 'Cookware' with normal quality and price, so the new shop won't attract the desired customers. He suggested the new shop to be named as 'Modern Cookware'. The idea worked and he opened many more shops by both brands. He observed that the people who use to buy at Rs. X are now willing to spend higher around Rs 1.5 X but not Rs. 2 X. Also, there are always enough customers for Rs X. So he used the same trick again and opened a new retail chain by the name 'Platinum Cookware' satisfying Rs. 1.5 customers. Now we had 3 successful chain outlets. Years passed and I came into picture. Well being the 'Shishya' of such visionary person I wanted to start something targeting youth group who are more bent towards classy, easy and high end cookware. I suggested him to open another retail chain by the name 'Metropolitan Cookware'.
1.) This whole scenario was based mostly on Target Audience.
Cookware is nothing but Peter England serving Mainstream class.
Modern Cookware is our Van Heusen, usually dealing in luxury clothing in formals.
Platinum Cookware is our Allen Solly trying to bridge the gap between former two.
Metropolitan Cookware is our Louise Phillippe offering luxurious formals as well as casuals.
2.) The second reason could be Mergers and Acquisitions.
In retail industry M&A are very common. In the above analogy if I didn't start any of the banner either I could create one of my own or if I have the capacity and cash (or equivalent) I'll acquire the banner and continue under same name due to its popularity and market share. Though over time I can try to finish it and establish my own name but at times it doesn't works (Coke tried to eliminate Thumbs up market share but it couldn't, thus continued with it)
3.) As I mentioned earlier If they won't, someone else will.
These (Aditya Birla's) brands will arbitrage each others business a little but in whole they will add lot more market share and revenue to the company. If we had exactly competing brands (Hypotheticaly if KFC and McDonald's were owned by same retailer) then also this strategy will be important as if I don't like KFC I'll move toward McDonald's. This can also happen if I get bored from one brand.