retail industry2 report

8/10/2019 Retail Industry2 report

1/21

Retail Industry Snapshot

FRPT Research 1

Wal-Mart, Tesco seek assurance on non-reversal of FDI policy

Global retailers like Wal-Mart and Tesco have sought assurance from India that

any change of governments at both centre and states should not result in reversal

of FDI policy in multi-brand segment, before taking investment decisions in the

country. Bentonville-based Wal-Mart has also raised apprehensions about the

ongoing probe by investigating agency Enforcement Directorate, said an internal

note of the Department of Industrial Policy and Promotion (DIPP).

Indian e-commerce firms ready sail-through plans

E-commerce companies in India have rushed to make announcements on new

offerings or are strategising fast on their next move, in the wake of Amazon, the

world's largest e-commerce company, entering India on June 5. eBay,HomeShop18, Snapdeal.com, and Flipkart are all on expansion mode to compete in

the e-commerce market projected to grow to $1.8 billion this year.

India's emerging retail destinations

All Indian and global retail brands operating in India have plans to expand into

cities where economic momentum is picking up. In these cities--Jaipur, Kochi,

Ludhiana, Indore, Nagpur and Udaipur--most local retailers already have a

footprint, but branded national and international brands also have their sights

trained on these emerging cities.

ISIEmergingMarketsPDF in kpmg1 from 115.114.45.146 on 2014 04 03 08:32:12 EDT. DownloadPDF.

Downloaded by in-kpmg1 from 115.114.45.146 at 2014-04-03 08:32:12 EDT. ISI Emerging Markets. Unauthorized Distribution Prohibited.


2/21


FRPT Research 2

Villeroy & Boch enters joint venture with Genesis Luxury

German bath, wellness and tableware firm Villeroy & Boch AG has entered into a

joint venture with Delhi-based Genesis Luxury Fashion to start its operations in

single-brand retail trade, and open Villeroy & Boch stores in key luxury shopping

malls across India. With the Foreign Investment Promotion Board (FIPB) having

approved Villeroy & Boch's application for 50 percent equity, the company will

infuse Rs 1.12 crore in the joint venture.

IPL fiasco: PepsiCo India President Manu Anand quits; no succession plan in

place

In a sudden development, Manu Anand, President for India and South Asia at

beverage and snacks company PepsiCo, has quit at short notice, without any

succession plan in place. Two company officials said concern at Pepsi's Asia-Pacific

headquarters over loss of market share to rival Coca-Cola as well as less-than-

expected returns from Rs 160 crore spent on the sixth edition of Indian Premier

League contributed to Anand's abrupt departure.

Tobacco major Gopal Corpco to enter the snacks market

Hoping to ride on its vast distributor network the 71-year-old Gopal Coprco Ltd.,

has now embarked into the FMCG sector, especially in the snacks category. GCL, a




3/21


FRPT Research 3

well-known name in the tobacco segment, aims to corner 2% of the Rs 12,000

crore snacks market with potato chips and other items.

Dunkin Donuts now calls itself a 'Beverage Company'

Dunkin is no longer beating around the proverbial bush. With coffee and other

drinks accounting for 58% of US franchisee-reported sales in 2012, the outfit's CFO

Paul Carbone told investors and analysts this week that they were now a 'beverage

company'.

Big investors look to log into Indian e-commerce

A new set of marquee investors are debuting in India's burgeoning consumerinternet market. Bulge bracket names such as Canadian Pension Plan Investment

Board (CPPIB) and the venture capital arm of telecom giant SingTel have met with

large start-ups, including e-commerce engines Flipkart and Myntra, as they explore

investments in the local market, said people directly aware of the matter.

Falling Re makes the going tough for apparel retailers

Brands relying on international sourcing for apparel and accessories are in for

tough times as the rupee continues its downward swing. Most retailers said they

would be able to absorb costs in the immediate short-term but did not have a

hedging mechanism if the fall in the rupee continued in the long run.




4/21


FRPT Research 4

RBI blow to affect Titan in a big way

Titan Industries Ltd has clarified some aspects of the Reserve Bank of India's 4

June notification on new rules of gold import.How would that impact

Titan?According to an analyst who attendeda conference call held for analysts, this

means that Titan's entire business model will change now.

CAIT opposes proposal to raise FDI limit in multi-brand retail

Opposing a government-panel proposal to hike FDI limit in multi-brand retail to 74

percent from the present 51 percent, the Confederation of All India Traders (CAIT)

said such a move would hurt the interest of small traders and benefit large

corporates. CAIT Secretary General Praveen Khandelwal said these

recommendations were not based on ground realities, and that the traders

community had not been consulted on the issue.

Textile export target set at $50 billion this fiscal: Rao

The new Textile Minister, K S Rao, Wednesday said the government has set anambitious export target of USD 50 billion this fiscal, hoping realisation of the target

will help in containing the high current account deficit. Textiles exports currently

stand at USD 34 billion.




5/21


6/21


7/21


FRPT Research 7

retail."We have given our recommendations to the Finance Minister. He has

forwarded them to the Department of Industrial Policy & Promotion (DIPP),"

Department of Economic Affairs Secretary, Arvind Mayaram, who headed the

panel, said on Tuesday, although he did not provide details of the report's contents.

V-Mart to open 28 stores in India

V-Mart Retail, a growing value retail chain in the country, will open 28 more stores

in tier II- and-III cities, where the penetration of organised stores is not much. A

senior company official said that by the end of the current financial year the

company would raise its strength to 100 stores across the country.

Handcrafted jewellery couturiers unveil flagship boutique in Delhi

SPR Jewels, wholesaler and marketer of handcrafted jewellery, has announced the

launch of its first retail boutique, Prithviraj Jewels, in New Delhi. The boutique will

showcase classic, exclusive vintage-style and one-of-a-kind creations in gold,

diamonds and other precious gems.

Homeshop18 will be the first national virtual retailer to sell food and grocery

After successfully launching apparel, home & kitchen items, mobile phones and

other categories, HomeShop18, India's largest virtual retail player now adds food




8/21


FRPT Research 8

and grocery Items to its exciting product range. With this move, HomeShop18

becomes the only national level virtual retailer to have food items in its portfolio.

Starbucks to set up shop in hospitals, schools, corporate campuses

Taking a leaf out of the marketing and distribution manual of archrival Cafe Coffee

Day, Tata Starbucks, the joint venture between Starbucks Coffee Company and

Tata Global Beverages, is considering opening outlets in hospitals, educational

institutions and corporate campuses to expand its retail footprint. People in the

know say the joint venture may also set up outlets near gyms or health stores.

Tata Global Beverages' annual report looks beyond business

Tata Global Beverages Ltd has decided to focus on a theme in its annual report, this

year's theme being women in business. Writing to shareholders for the first time as

Chairman of Tata Global Beverages Ltd, Cyrus Mistry has dwelt upon this theme,

given the widespread discourse on gender sensitivity in the country and abroad.

Cafe Coffee Day increasing automation, reducing vendors

Cafe Coffee Day is increasing automation in coffee brewing across its 1,500 cafes

and has consolidated the number of its food vendors as it looks to improve the

quality of its fare and control costs. "The consolidation has ensured uniformity in




9/21


FRPT Research 9

quality to a very large degree and (brought) costs benefits as well," CCD's

Marketing Chief, K. Ramakrishna said.

Demand for direct selling law; global CEOs to visit India

In order to push for a separate legislation for the direct selling industry in India,

top global executives of such firms would be visiting the country later this year.

The CEO council of World Federation of Direct Selling Associations (WFDSA)

would be coming to India for the first time. "This is to discuss the roadmap of

direct selling industry in India and also to meet various stakeholders to put up a

case for a separate legislation for the industry," Indian Direct Selling Association

(IDSA) Secretary General, Chavi Hemanth, said.

Timex Group to stop selling Marc Ecko products in India

Timex Group India Ltd posted a net loss of Rs 42 crore in 2012-13. It is not hopeful

of recording a profit in 2013-14 either. "We don't foresee profits this fiscal also," M.

K. Bandyopadhyay, MD, Group India Ltd, said, adding that the company has

decided to stop selling its premium Marc Ecko brand products in the country.

Why RmKV is setting foot in malls

Silk sari retailer RmKV believes the time has come for traditional family retailers to

move into the malls. The retailer says mall spaces offer the brand access to a more




10/21


FRPT Research 10

"high-profile and younger" set of customers who seek greater comfort and a better

shopping ambience; add to it the fact that congested roads and lack of adequate

parking space tend to put off the young and the more affluent from shopping on

the high streets.

Auchan Indian expansion plans underway

Auchan has confirmed that 13 Max hypermarkets have now been brought under

the Auchan banner in Delhi and in the southern parts of India, following the

franchise agreement signed in August 2012 by Auchan and Max Hypermarkets

Private Ltd.By the end of 2013, Auchan will reinforce its presence in the northern

states with six new openings, along with continued growth in southern regions,

with the opening of a second Chennai store and two new hypermarkets in

Bangalore.

Craftsvilla goes the retail way, will open stores

Craftsvilla.com, an online luxury brand that focusses on Indian design theme, has

plans to open more than 50 franchise stores in the coming months. "We see this as

a step towards quantum growth in our business by mixing offline and onlinebusiness models and utilizing the strength of our brand, supply base, current

customer base and technology to reach more and more customers in India," Manoj

Gupta, CEO of craftsvilla.com, said in a statement.




11/21


12/21


FRPT Research 12

Electronic brands find loophole to get around FDI norms on e-retailing

Electronic brands such as Dell, Samsung and Cannon have found a way to beat FDI

rules governing e-commerce, to sell their products online; they are selling their

wares through websites created specially for them by Indian distributors. Said

Alok Bharadwaj, Executive Vice President, Canon India, "We cannot sell our

products online directly, but we can sell through exclusive partners or franchises.

Flouting of the FDI norm will happen only when billing of the products are done

directly by us."

Da Milano to open retail store at Terminal C in Mumbai airport

Da Milano, which is already present strongly in the travel retail segment with eight

travel retail stores across various national and internations airports of India, isnow all set to launch the ninth Da Milano travel retail store at Terminal 1 C of

Mumbai Airport soon.

Tatas looking at European buys to brew instant coffee business

Tata Coffee, India's second-largest producer of instant coffee, is aggressively

looking to expand its business by acquiring companies. It is currently scouting for

suitable firms in Europe and planning to close the deal some time this year, a top

company executive said.




13/21


14/21


FRPT Research 14

website and showcases the growing interest of online retailers towards the Indian

market.

US-based burger chain to open outlets in India

Los Angeles-based burger chain The Counter is entering India. With over 3,000

different combinations, a burger at Counter will cost a minimum of Rs 400. That's

eight times more than the rates at the most famous global burger chain,

McDonald's, which operates assembly line-like stores in 13 Indian cities.

Van Heusen to add exclusive franchise stores

Van Heusen plans to open ten exclusive women's wear outlets and around fiveaccessory outlets this fiscal, with an estimated investment of Rs 10 crore. About 70

percent of these stores will be set up under the franchise model.

Tesco stops sourcing from a Bangladesh factory due to safety concerns

Tesco, the world's No. 3 retailer, has stopped sourcing clothes from a factory in

Bangladesh after discovering serious problems with the safety of a building, the

company said on Saturday. The move follows a survey the British-based

supermarket chain conducted in the wake of the collapse of the Rana Plaza factory

complex in Dhaka in April.




15/21


16/21


17/21


FRPT Research 17

Tradeindia.com launches new portal for appointing distributors & sales

agents

After its success with the B2B marketplace portal, Tradeindia.com's Founder and

CEO, Bikky Khosla, has launched getdistributors.com meant for companies looking

to appoint distributors and agents at places where they cannot reach easily. Khosla

said that the new website will help mid and large businesses boost their channels

of sales and distribution.

How did some of the Indian Internet startups become trailblazers?

A report from Avendus, a market analyst, estimated the Indian online retail to be

worth more than Rs 8,000 crore in the 2013 fiscal. India is now a hotbed for

Internet startups. What did the trailblazers do?

Groom India to open 3000 'Naturals' outlets by 2020

Groom India Salon & Spa Private limited, a Rs 180-crore company that owns the

unisex salon brand Naturals, said on Tuesday that it was targeting a Rs 350-croreturnover by opening 3,000 outlets across the country by 2020. "We have a strong

feeling that the franchisee route is the best way to grow our business," said Groom

India Salon & Spa Co-founder and Chief Executive officer, C K Kumaravelu.




18/21


FRPT Research 18

Govt should stick to the clarifications on retail FDI: CAIT

The government should stick to the recent clarifications released on FDI in multi-

brand retail trading and not ease the conditions for foreign retailers, traders

bodyConfederation of All India Traders (CAIT)said on Tuesday. In a letter to

Commerce and Industry Minister Anand Sharma, CAIT said, "The government must

stick to the clarifications issued and should not bow under any pressure

whatsoever."

Value of jewellery exports rises as rupee slides

The weakening of the rupee against the dollar is a double-edged weapon for gold

jewellery chains, especially those based in Kerala, where most jewellery chains run

export divisions. While the depreciation in the rupee has led to costs of imported

gold rising, it has also increased the value of the gold jewellery that is exported.

FDI in retail may be thwarted by India's endemic corruption

Notwithstanding the hyperbole over FDI in retail, there is an element of despair indoing business in India. Many foreign investors cannot stomach the all-inclusive

and pervasive phenomenon of corruption that is fiercely entrenched in every level

of setting up shop in the country.




19/21


20/21


21/21

retail industry2 report

Documents