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Aditya Birla Retail to rope in investor, looking for funding

admin — Thu, 11 Mar 2010 13:07:15 +0000

Kumar Mangalam Birla’s retail venture, Aditya Birla Retail, is reportedly open to roping in a financial investor to fund its expansion plans. Even though the company declined comment, it is learnt from sources that the firm is not
averse to diluting its equity by about 10% to a sleeping partner. However, it would rather wait for more clarity on the regulatory front with respect to such investments.

Given the rate at which Aditya Birla Retail is expanding , funding will be an important factor especially with the rising rentals in the realty market, industry sources said. Aditya Birla Retail operates supermarkets under the “more” brand and hypermarkets under the “more.megastore” brand across the country.

It has opened its sixth megastore in Thane (the first in Mumbai/Thane). With 632 supermarkets and 6 hypermarkets under its wings, Aditya Birla Retail is gradually moving ahead with its expansion plans, even as it continues to identify and shut down unviable stores.

“We may close down 40-50 stores which we feel are not viable. However, this year we would also be adding around 48 more stores as part of our expansion drive,” Thomas Varghese, CEO, Aditya Birla Retail told TOI. According to Varghese, this year is critical for all the company’s stores from the profitability point of view.

Aditya Birla Retail speeds up, to open one hypermarket a month

admin — Thu, 04 Mar 2010 03:06:11 +0000

Aditya Birla Retail plans to invest Rs 1,800 crore over the next eight years to scale up its ‘More’ hypermarkets across the country. It looks to open one store per month at an investment of around Rs 20 crore per store, said Thomas Verghese, CEO of the company, on Wednesday at the launch of a hypermarket at Thane.

Aditya Birla Retail, which has 632 supermarkets and six hypermarkets, plans to increase the number of `More Megastore’ stores to 100, while shutting down some loss-making super markets. “We are focusing on our hypermarket format where we can introduce more stock keeping units (SKUs) to churn out more profits from large shop formats,” Mr Verghese added.

Currently, ‘More’ has 13 in-house (private labels) power brands in various categories with 320 SKUs in the FMCG segment. Hypermarkets have a minimum size of 50,000 sq ft compared to super market’s 2,500 sqft. “As a part of our cleaning up process, we are planning to wind up quite a few number of supermarket stores which are not profitable,” Mr Varghese said.

According to a report published by PricewaterhouseCoopers (PWC) on retail and consumer industry in association with Retail Association of India (RAI), the country’s retail sector is worth $350 billion and growing at around 15% annually.