NEW DELHI, Apr 14: Multi-brand retail chain V-mart is mulling foray into the international market and is currently conducting a feasibility study in Bangladesh to set up its shop there.
“There is a huge potential in Bangladesh as the country’s retail business is primarily unorganised. The organised retail space is almost vacant. We are currently conducting a study of the market,” V-mart Retail Chairman and MD Lalit Agarwal told here.
A team from the company has just returned from the neighbouring nation and the management will study its observations during the coming days, he added.
“We are just trying to understand the market there. Before taking any decision, we have to read their laws, FDI norms and the political situation. Depending upon their laws, we will decide whether we will go solo or look for an associate. We are at the survey stage now,” Agarwal said.
He said the feasibility study of the market is likely to complete in the next 6-12 months and a decision will be taken only after that.
When asked any timeline for launching the first store in Bangladesh, Agarwal said: “It is too early to say.”
He, however, said whenever it will start business in the country, the company will source materials from both local market and India.
Without sharing any detail, Agarwal said the company may look into other neighbouring markets such as Sri Lanka and Nepal in future.
V-mart has recently raised Rs 122 crore through an initial public offer to fund its expansion plans of almost doubling its showrooms to 120 outlets by 2015 in smaller Tier II and III cities in India. It currently operates 69 outlets.
Agarwal said out of the total amount from the IPO, Rs 86 crore came into the company’s account, while the rest went to private equity players as offer-for-sale.
Post-IPO, the promoters hold 59 per cent stake in the company, while Adity Birla Group’s private equity fund Naman Finance & Investment owns 9 per cent stake. Rest is diluted to public during the IPO.
The National Capital-based V-mart Retail operates a chain of departmental stores offering apparels, general merchandise and kirana goods. It sources the materials directly from small manufacturers. (PTI)
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