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Year: 2014

Retail Brands

How Reliance Retail is Building Strong Franchise of Global Fashion Brands ?

Reliance Fashion Global BrandsReliance Retail’s subsidiary Reliance’s Brands vertical operates on a franchise model. This has been a small vertical contributing only 2% of total revenues, but growing at 50%-plus. The company is consistently tying up with global brands and widening its product portfolio – given its wide distribution of over 100 branded stores under this model. We believe as clarity on FDI in retail emerges this brand relationship with good sales growth trajectory could potentially result in healthy returns going forward.

The Following Chart Shows (more…)

Retail Research

Why Reliance Fresh is Embracing Online Model ?

Reliance Fresh Online GroceryWith the growing potential of e-commerce – Reliance Retail recently started its pilot entry into e-commerce with online grocery store (RelianceFreshDirect.com). The company through this website will deliver fresh grocery products (fruits, vegetables, dairy products, groceries, packaged food, confectionery, personal care products) to service few micro markets in Mumbai (ie South Mumbai and some suburban markets).

The online retailing in India stands at $600mn per annum currently and is likely to (more…)

News & Views

Kishore Biyani’s Future Retail No Turnaround Insight

Future Retail TrurnaroundKishore Biyani led Future Retail Ltd reported a recurring PBT loss of Rs-282mn during Q2FY15. Revenue growth was 10% y/y and EBITDA margins rose 160bp y/y (flat q/q). This was led by gross margin expansion of 120bp y/y on account of improved product mix (in favour of apparels which now account for over 35% revenue share). Staff and rental costs witnessed modest sequential increases of 1% and 3% q/q, respectively. However, other expenses rose 9% q/q on account of higher marketing spend.

Value Retail registered 14.1% SSSG (more…)

News & Views

Domino’s Pizza Same Store Sales Down

Dominos Pizza IndiaJubilant FoodWorks is the largest food service company in India and is Master Franchisee for Domino’s Pizza in India, Nepal, Bangladesh, and Sri Lanka. With over a 50% share of the market, it is the leader in the formal pizza market. It is also the Master Franchisee for Dunkin’ Donuts in India. Currently, there are 806 Dominos stores (170 cities) and 38 Dunkin Donut stores (13 cities).

Same Store Sales growth has declined further to ‐5.3% while the addition of new stores has resulted in pressure on margins. We believe the pressure (more…)

News & Views

Festival Season Weak for Titan / Tanishq

Tina-Weak RecoveryTitan’s Jewellery business had large bump up in sales due to closing of Golden Harvest Scheme (GHS) in the quarter that contributed to c50% of total jewellery sales in Q2. Studded jewellery share of 35% declined by 4pp yoy but still grew at 48% yoy primarily due to GHS closing related sales. Titan added 21K sq ft jewellery retail area in Q2 FY15 as it opened 2 stores Jewellery retail area expansion plan continues apace with overall expected addition of about c100k sq ft in FY15e.

Although management believes that (more…)

News & Views

Smiling Baby Store to Open in Adyar, Chennai

Smiling Baby Store Opened in ChennaiChennai’s Adyar will shortly see a new retail store Smiling Baby being opened on Friday, Sep 26th 2014. The store would be inaugurated by Shri Kodandarama Setty, Chairman & Managing Director, Viveks Ltd. Smiling Baby is the result of the potential gap in the babycare needs in the country, and more so in Chennai/Tamil Nadu.

Smiling baby, will be a niche retailer catering to new born children up to 6 years of age and provides a place for expecting mothers and young parents (more…)

Retail Research

Arvind to Embrace e-Commerce across its Brands

Creyate - Arvind's Customized Apparel Online RetailARVND has incorporated a separate entity, Arvind Internet Limited, which will operate its e-commerce business. The management believes that branded garments is the only category where e-commerce players have positive cash flow. With backward integration into fabric and supply chain expertise, ARVND will be in a uniquely advantageous position.

ARVND has launched its own exclusive online (more…)

Retail Brands

ARVIND To Open 50 GAP Stores in India by 2018

GAP Arvind India VentureWe interacted with the Management of ARVIND Ltd and came out extremely positive on their approach and vision for brands and retail expansion plans in India.

GAP is a leading specialty brand retailer, with a global turnover of USD16.1b. It began operations in 1969. It is now available in 90 countries through 3,100 company-operated stores, over 350 franchised stores, and e-commerce sites GAP has tied up with ARVND to open 40-50 stores by FY18. The first store should be operational by May 2015, with (more…)

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