There is no reason for any pessimism on Indian retail market prospects, Sanjeev Agarwal, the Joint CEO of Big Bazaar, the Future Group chain, said here on Friday.
Speaking to Business Standard at the launch here of their 148th store in the country, he said the market was far from saturation. “We plan to continue opening one to two stores every month,” he said. “We are positive on consumer spending.”
Agarwal said the chain’s revenue was growing at 25 per cent yearly. However, he declined to talk on investments made or being planned.
Ruling out a foray abroad, he said the opportunity in India was quite large and, therefore, there was no reason to look elsewhere. “Our strength lies in knowing the Indian customer well.”
As for the decision by retail chains, including his own, to substitute Reckitt Benckiser’s products with their own after the latter cut the sales margins it allowed them, Agarwal said the shift to in-house brands (he prefers the term ‘private brands’ to ‘private labels’) was 15 years old, not something triggered recently. “We have been running the private brand programme for 15 years now,” he said. The Future Group had always believed in managing the entire supply chain, he added.
On the protest against the Budget proposal to impose 10 per cent excise duty on branded apparel, Agarwal refused to comment. Earlier, retailers, including the Future Group, had said their stores would down shutters on Monday, to express their protest against the move. “No comment,” was all that Agarwal said on Friday on the matter.
The Future Group operates other retail chains, too, such as Pantaloons, Food Bazaar, Central, Home Town and eZone. It also has a presence in other segments such as consumer finance, insurance, logistics, brand development, and infrastructure. Future Group CEO Kishore Biyani had recently said stake sale was a possibility in some non-core assets, to be able to raise between Rs 2,500 crore and Rs 4,000 crore. The Group’s overall debt was pegged at Rs 4,800 crore, according to reports.
The Future Group is believed to be in talks with French retail major Carrefour for a joint venture, but that can only happen after the government opens multi-brand retail to foreign investment. Carrefour has, meanwhile, entered India in the wholesale business, and has opened one outlet in the capital. Up to 100 per cent foreign direct investment is allowed in the wholesale business, up to 51 per cent FDI in single-brand retail, and no foreign investment is permitted in multi-brand retail.
