Aryan lines up Rs 45 cr for 55 Nike stores

Aryan Lifestyle Pvt Ltd, a wholly owned retail subsidiary of real estate developer MGF, is planning to open 55 Nike stores across the country in the next financial year at an investment of Rs 45 crore.

The company has raised Rs 5 crore through 50 per cent equity and 50 per cent through soft loans from the directors of MGF.

"With MGF promoting us, we do not see the need of borrowing from outsiders," said Deepak Chhabra, chief operating officer, Aryan Lifestyle.

He said MGF would funding the company for the next three years, after which internal funds will start being generated.

Nike India, which entered the country in 2004, has not engaged a master franchisee. Instead, the multinational company opted for direct tie-ups with local partners.

It also tied up with strategic partners, such as Aryan Lifestyle, as national partners. Nike currently has close to 100 single-branded outlets in the country.

In contrast, Reebok India follows the franchisee model and currently has approximately 260 single-branded stores in the country.

The recent Union Cabinet decision to allow 51 per cent foreign direct investment has not impacted Nike India's strategy.

"While we welcome the move, we prefer our current model. We believe our partners have the financial assets for the required investment," said Sanjay Mehra, general manager, South Asia.

As of now, Aryan's Chhabra is planning to open 1,000-4,000 square feet exclusive Nike outlets. However, he is also in touch with "other non-contradictory foreign brands for opening other single-branded stores". He hinted that one such brand could be a fashion line for casual clothing.

In the next 40 days the company plans to open 12 stores which include three each in Bangalore and Pune, two each in New Delhi and Vadodara, and one each in Dehradun and Ahmedabad.