Undeterred by soaring rentals and inflation gnawing at profit margins, retailers are entering the expansion gambit with an élan.
BANGALORE: Undeterred by soaring rentals and inflation gnawing at profit margins, retailers are entering the expansion gambit with an élan.
Dubai-based retail major Landmark group for one is planning to invest Rs 550 crore into its twin ventures - Max Retail and Max Hypermarkets.
Landmark group is eyeing a bigger slice of the retail pie by 2010-11. The move will take up the retail major’s total store count to 100 outlets.
Max Retail, the group’s lifestyle arm with a presence in eight cities, will be branching out to tier-I and tier-II cities with 12 stores by March 2009. The company plans to pump in Rs 350 crore for expansion.
Vasanth Kumar, executive director - Max Retail, said the company would locate its store in malls instead of high streets to cut costs.
“Each store will be spread over an area of 15,000 sq ft and most of the stores will come up in malls as high streets are not viable in terms of costs,” Kumar said.
The outlets will house apparel, footwear and home furnishings.
The company currently has 15 stores covering 2.25 lakh sq ft of retail space across Bangalore, Delhi, Hyderabad, Mumbai, Ahmedabad, Indore and Lucknow.
It will add another 11.05 lakh sq ft after its expansion comes through.
“We aim to have 10-12 stores in each metro,” Kumar said.
The company is also planning to open new stores in Chennai by the year-end and in Kolkata by October 2009.
The company will invest Rs 200 crore by 2009 to expand its Max Hypermarkets format. It plans to set up five stores, including hypermarkets and supermarkets.
The stores will come up in Hyderabad, Chennai and Bangalore. The company has rolled out two hypermarkets in Bangalore in the last 10 months.
Viney Singh, managing director - Max Hypermarkets, said the company would cover Tamil Nadu, Andhra Pradesh and Karnataka next year. “The Max Hypermarket will cover 70,000 -1 lakh sq ft of our retail area and supermarket will be spread across 20,000- 30,000 sq ft,” he said.
Landmark group currently has 1.45 lakh sq ft under the hypermarket format, which would be expanded to 4.25 lakh sq ft by 2009.
Max Hypermarkets is also looking at raising Rs 200 crore from private equity players by 2009 and expects its turnover to touch Rs 300 crore by 2009- 2010.
k_sobia@dnaindia.net
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