Ritesh Properties forays into retail sector

Ludhiana-based Ritesh Properties and Industries Ltd (RPIL), which has diversified interests in garment export and real estate, has announced its entry into retail.

By the end of this year, the company is planning to launch its own retail brand called "Femella", a women ethnic wear range.

In order to strengthen its overseas retail operations, RPIL is also acquiring a major sports brand called Catalina Bay in the US. This brand acquisition will help the company in marketing its apparel in the US market.

Speaking to Business Standard, Sanjeev Arora, managing director, Ritesh Properties and Industries Ltd, said, "Considering our expertise in apparel segment, we are launching a women's wear segment."

"Priced fairly and catering mainly to the working women, RPIL plans to launch the branded wear across India, beginning with northern India."

In the first year of its operations, RPIL would be investing Rs 25 crore funded mainly by debt and internal accruals. The company will form a separate wholly-owned subsidiary for this purpose.

By the end of this financial year, RPIL will be opening up 20 exclusive outlets, beginning with two in New Delhi. Other outlets will come up in almost all major cities of Punjab and northern India. By the end of next fiscal, 100 more outlets will be opened.

"To begin with, around seven outlets will be company-owned and once we leave a mark in the market, others will be on franchisee basis," Arora said.

Regarding the acquisition of the US brand Catalina Bay, Arora said RPIL was planning to market corporate casuals in the US and will be investing Rs 35 crore in inventory, purchase of assets and working capital.

"Through this brand acquisition, the sales and profitability of both the companies would increase, as we will be getting higher margins on account of elimination of distributors and wholesalers".

After the launch of Femella and Catalina Bay, the company expects its turnover to reach Rs 30 crore by the end of financial year 2007-08 and to Rs 60 crore by 2008-09. "We want to grow by at least 100 per cent in the next three years," added Arora.