Shoppers Stop to invest Rs350 cr, open for FDI
CL Raheja-promoted Shoppers Stop, which also owns the Hypercity retail brand, said it is open to foreign direct investment (FDI) in the company. Govind Shrikhande, managing director, however, clarified that the company was not in talks with anybody at the moment.business Updated: Dec 03, 2011 02:45 IST
CL Raheja-promoted Shoppers Stop, which also owns the Hypercity retail brand, said it is open to foreign direct investment (FDI) in the company. Govind Shrikhande, managing director, however, clarified that the company was not in talks with anybody at the moment.
"We are neither closed to a tie-up with anybody nor looking at any FDI today and Hypermarket is one place where we can look at for FDI investment," Shrikhande told HT.
"The investment will happen in five to seven years. It's a long term play, like every other sector and FDI will come in once reforms happen," he said.The company is looking at aggressive expansion to open Shoppers Stop department stores and has lined up Rs350 crore as the capex for the next three years, Shrikhande said.
The retail major, which currently opens eight to ten stores every year, is upping the ante and hopes to open an average of 40 stores a year from the next fiscal -a four to five fold increase in new store openings. Much of this is directed towards opening up of new stores, especially in tier II and tier III cities.
The retailer's target clientele, is the top 15% of the Indian population. At present, 70-80% of sales turnover comes from urban areas, which is unlikely to change as the consumption is growing in urban areas.
He also said that fears of the kirana shops do not face any long-term threat from the organised retail sector.
"The organised retail sector will at best garner a market share of 15-18% - the majority will be dominated by the unorganised sector - for the simple reason that the large retailer can not match the knowledge of the catchment area," he said.