1/11/2015

Tescotoopen68multibrandstoresinIndiathisyear|BusinessStandardNews

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Tescotoopen68multibrandstoresinIndiathis
year
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1/11/2015

Tescotoopen68multibrandstoresinIndiathisyear|BusinessStandardNews

Notholdingplansforclarityonpolicy
RaghavendraKamath|MumbaiJune17,2014LastUpdatedat00:58IST
SubmitResumeNow
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RelatedNews
Tescodeniesgovtpressure
TescoupbeatonTrenttieupforgrowthinIndia
FIPBtotakeupTesco'smultibrandretailproposalonDec30
TescoTatajointventureatestcaseforretailFDI
Moregoodnews,surprisescomingforFDIinmultibrandretail:Sharma
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UKbasedTescoischalkingoutexpansionplans,evenasmostglobalretailmajorslikeWalmartarewaitingfor
apositivesignalfromtheNarendraModiledcentralgovernmentbeforemovingaheadwiththeirplansforthe
Indianmultibrandretailsector.Thecompany,inequalpartnershipwiththeTatagroup'sTrent,isworkingon
openingsixtoeightnewstoresinMaharashtraandKarnatakaunderthreeofitsformatsthisfinancialyear,
informsasourceawareoftheplans.
Tescoistheonlyforeignretailertohavemadeaproposalformultibrandsincethesegmentwasopenedtoupto
51percentforeigndirectinvestment(FDI)in2012bythethenUnitedProgressiveAlliance(UPA)government.
ThepresentNationalDemocraticAlliance(NDA)governmentunderModiisopposedtomultibrandretailFDI
buthasnotreversedtheUPApolicy.Sourcesindicatethenewgovernmentisunlikelytoentertainanewmulti
brandproposalatleastinthenearfuturethatcouldfornowmeanadvantageTesco.
TheUKretailer'sadditionofsixtoeightstoreswilltakethetotalnumberofTescoTrentoutletsinthecountry
to20.Initsproposal,TescohadclearlysaiditwasgoingtoinvestinMaharashtraandKarnataka,both
Congressruledstates.Clearancebystatesconcernedisamongtoughconditionsinthemultibrandretailpolicy.
InMarchthisyear,TescoandTrenthadsignedapact,underwhichtheformerboughta50percentstakein
TrentHypermarketsLtd(THL)andagreedtopumpRs850croreintheventure.
THL,whichcurrentlyruns12storesacrossMaharashtraandKarnataka,wouldopenstoresof1,000sqftto
30,000sqftinPune,MumbaiandBangaloreunderStarBazaar,StarMarketandStarDailyformats,depending
onlocationandsizeofthepropertiesavailable,thesourcesaid."SincetheyhavedistributioncentresinMumbai
andBangalore,itmakessensetopenetratethosecitiesdeeper."
THLwouldopentwoorthreestoresinBangalore,PuneandMumbai,thesourceindicated.Thechainwillhave
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1/11/2015

Tescotoopen68multibrandstoresinIndiathisyear|BusinessStandardNews

1,000to5,000sqftstoresundertheStarDailyexpressformat5,000to20,000sqftoutletsundertheStar
Marketformatand20,000to30,000sqftonesundertheflagshipStarBazaarformat.AmailsenttoTHL's
publicrelationsagencydidnotelicitanyresponse.
Thecompanyisexperimentingwithdifferentformatsforbetterprofitability.Interestingly,afterannouncingthe
jointventure,thecompanyhasreducedthesizeoflargestoresfrom40,00080,000sqftto20,00030,000sqft
tosaveoncosts.
"Weareevaluatingotherformats.Weopenedasmallerformatstore,StarDaily,inPune.It'saconvenience
storethatisdoingverywell.Weplantolaunchasecondoneshortly,"TrentChairmanNoelTatasaidinan
interviewtothegroup'sinhousemagazine'TataReview'."Webelievethesemidsizedformatswillreach
profitabilityfaster."
ThoughStarBazaarhadsetupitsfirststorein2004,itisyettoachieveprofits.In201213,thechainreporteda
netlossofRs72croreonnetsalesofRs785crore.StarBazaar's201314numbersarenotyetavailable,while
TrentpostedaconsolidatednetlossofRs18.73croreintheyear,comparedwithalossofRs37.94crorein
201213.
Thenewstoreswillfocusonfoodandlooktoofferbettercustomerexperience."Forinstance,theisleswillbe
widerandhavebetterassortment,"thesourcesaid.
"WehaveFDIlicenceandhavenoissueswiththegovernmentpolicy.Wewillnotopenstoresifaparticular
statesaysno,"saidasourceintheTescoTrentJV."Atpresent,wewillfocusonopeningstoresinKarnataka
andMaharashtra,whichhavewelcomedFDIinretail."
TechnopakAdvisorsChairmanArvindSinghalsaysTescocouldbeexperimentingwithdifferentformats
beforefocusingonwhatworksbestforthecountry."Oncetheygettherightmodel,theycangomore
aggressive."
EXPANSIONMODE
TescoTrent'sstorerolloutroadmap
Plan:Addingsixtoeightstorestoits12atpresent
Sizeofoutlets:1,000sqftto30,000sqft
Location:FocustobeonPune,MumbaiandBangalore
Formats:StarBazaar,StarMarket,StarDaily
Change:Widerisle,betterassortment
Readmoreon:
Tesco
|
Expansion
|
Walmart
|
Fdi
|
Thl
|
TataGroup
|
NarendraModi
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Tescotoopen68multibrandstoresinIndiathisyear|BusinessStandardNews

|
NdaGovernment
|
TrentHypermarkets
|
MultibrandRetail
|
StarBazaar
|
StarMarket
|
FdiInRetail
ReadMore

LendersexploringdebtrecastforREIAgro
BankshavealreadyclassifiedREIAgroasSpecialMentionAccount
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