Currently, @Home stores are located in all major cities of the Western and the Southern India. However, after expansion, the retail chain would have expanded to most of the tier II and III cities, across India, particularly new cities located in the Northern and the Eastern regions of the country. Presently, the chain operates stores at Ahmedabad, Bangalore (2), Chennai, Coimbatore, Ghaziabad, Hyderabad, Mumbai (3), Pune (2), Surat, Vadodara, and Vashi (Navi Mumbai).

Neelkamal will be investing Rs 140-crore on @Home’s expansion. The entire expansion will be funded through internal accruels, though debt could be also be considered later if so required.

“We are planning to invest more in our home furnishing business as the segment is doing well. We will invest around Rs 3.5 crore per store,” said Manish Parekh, Neelkamal’s director. “We plan to open at least 2-3-stores by this year-end,” added Parikh.

@Home stores, which registered a sales turnover of Rs 127-crore last year (2008-09), is expecting to Rs 140 crore turnover, this year.

Neelkamal, according to Parikh, is also looking at introduction of new products including some exclusive designs of furniture and cupboards for children, bathroom products, office furniture and other home furniture for launch. Apart from new range of furniture, the company will also be giving a strong thrust to its lighting and home furnishing business.

“Our aim is to make @Home cater to every requirement of the customer,” said Parikh.

Apart from experiencing falling footfalls and declining basket size (average invoice value) due to global slowdown, the highly leveraged retail chain was facing the problems of high interest cost and paying heavy payroll expenses.

On both the counts, the company, according to a BS report, appears to have succeeded. Vishal has been able to bring down the number of employees by a whopping 45 per cent from nearly 16,000 a year ago to 8,500 now. The company has also been able to address the problem of high interest cost by bringing it down from Rs 10 crore a month earlier to Rs 7.25 crore a month now. The interest cost has mostly come down due to negotiaon of interest rates with the lenders. Against a high rate of 15 per cent per annum the rate has now come down to 9.75 per cent. What is most worrying, however, is the fact that the company continues to carry a high debt burden of Rs 730 crore at an extremely debt/ equity ratio of 1.7.

“We have told the bankers that ours is a profit-making business model. All we need is some leniency in the rate of interest, so that we could make a comeback,” said Ambeek Khemka, group president.

Unless the company resorts to further dilution of some of its investments in assets, or inducts fresh equity capital in the system, it will be extremely difficult for the retailer to improve upon its leveraged position.

One of the major reasons for highly leveraged position of Vishal Retail could be attributed to the policy of going in for ‘unbridled expansion’ of its retail network. At one point of time, the number of its stores had crossed 184 while the space occupied by these stores had almost touched three million sq ft.

Most of the Vishal’s expansion like many other fast growing retailers (like Subhiksha) was funded via short term funds in the hope that fresh infusion of capital will help replace these high cost, low maturity funds.

The sudden plummeting of equity markets, however, led to a situation in which there was a sudden evaporation of capital from the markets. Even the plan for dilution of promoters’ equity stake could not fructify as most of the potential buyers themselves were struggling for raising funds and at the same time pruning their own operations.

“Excess short-term debt, coupled with plans of equity fund raising falling apart owing to poor market sentiments, led to sub-optimum capital mix and increased interest burden,” said Khemka.

Vishal Retail, which has now begun to clock over Rs 100 crore in monthly sales, is looking at closing down 20-odd stores to further rationalise its business. It is also looking at optimising employee expenses by cutting down on travel and communication allowances, particularly that of the top management, including the president.

“We are looking at increasing our per-employee productivity and this is one step in that direction,” Khemka added.

Green Design Studio, which had opened its first outlet at Bangalore in April this year, is a one-stop shop for a wide array of over 500 designs of laminate and 200 imported veneer products under one roof. The exclusive store helps customers in making intelligent choices for all their need of surface products.

Green Design Studio, according to Subir Palit, Greenply’s country head (decorative), has planned to open 25 stores across all major cities of India, including Kolkata, Hyderabad, Ahmedbad, Pune and Chennai, during the current financial year. The opening of such exclusive stores is mainly aimed at building the image of the brand.

Green Design Studio is a retail initiative of Rs 725 crore, Greenply Industries. Founded by S. P. Mittal in August 1984, Greenply is today the country’s largest interior infrastructure company. It accounts for 25 per cent of the plywood and 15 percent of the laminate markets in the organised sector of the country.

“Green Design Studio is the pioneer initiative aimed at providing a world-class interior shopping experience to the customer. The concept of Green Design Studio was conceived on the basis of assisting customer make an “intelligent” choice. At the studio, there is a large display of laminate and decorative veneer showcased to set the customers imagination rolling. The customers while shopping for their home interiors can feel and experience the entire range of the products,” said Saurabh Mittal, CEO and JMD, Greenply Industries Ltd.

Greenply is the country’s only integrated manufacturer that offers widest range of surface finish and foundation/structural products catering to interior infrastructure requirements of homes, offices and other institutional buildings.

Welhome chain offers a wide range of home, kitchen, and lifestyle products clubbed under the category of ‘home accessories. Its offerings, among others, includes products like bed sheets, towels, blankets, quilts, fillers, dohars, glassware, tableware, and soft toys.

While, the current financial year 2009-10 will be devoted towards consolidation and margin expansion, the company, according to a DNA report, will undertake aggressive expansion of its network during the next financial year 2010-11.

The retailer, according to its director Dipali Goenka, is currently busy with renegotiating property rentals and outsourcing requirement of merchandise to improve on profit margins.

“We are a 3-4 year old company and the home segment is an evolving category. We are present in tier-II markets, but tier-III markets remain unexploited. We also want to have more stores in the east of India, where we have 10 stores as of now,” said Goenka.

Although, the retailer is planning to add a few stores (around 25) this year, the real push is expected in 2010-11 when there could be an addition of as many as 75 to 80 stores. Even among these, the focus will be on rural areas, which could account for nearly one-third of the new stores.

“The real growth for the retail industry will come from the tier-II and the tier-III markets as these are evolving. Our contribution to sales from tier-II locations is 40% now. If we make inroads now, it will pay dividends in future,” added Goenka.

Welhome traces its genesis in the opening of a Welspun Factory Outlet in 2005 that focused on catering to the requiremens of mass market that was conscious of ‘value’ for ‘money.’ In 2006, it was rechristened as Wespun Home Mart and finally converted into its current avatar of ‘Welhome’ in 2007.

Home accessories market, estimated at around Rs 9,300 crore, is highly unorganised as 97 per cent of its sales are accounted for by traditional small players.

“Home Town,” the “first of its kind home improvement format” in India, owned by Home Solutions (India) Ltd, a wholly owned home retail subsidiary of Pantaloon Retail India, is all set to open its largest store in Kolkata.

The new 200,000 sq ft ”Home Town”  store of the group is located in Bengal Shrachi’s “Block by Block” mall. The new mall located near Rajarhat Road in New Town area of the “City of Joy.”

“We have always shared a special emotional connect with Calcutta and this HomeTown store is an affirmation of our faith in this city,” said Kishore Biyani, Future Group CEO, while speaking about the group’s new initiative in Kolkata.

“This will do wonders for Rajarhat’s sagging public image, which has seen negative perception amplify in recent months over infrastructure issues. A huge destination retail address like HomeTown has the power to draw footfalls from far and wide,” said Rahul Todi, the managing director of Bengal Shrachi, owner of the mall that has appropriately been billed as the country’s “First Complete Home Solutions Mall.”

The Kolkata Home Town store is around double the average size of other outlets of the retail chain. This Rajarhat store is targeting to garner ”substantially higher” revenues compared to its sibling stores in other parts of country.

Home retail segment, which apart from Home Town also includes durables chain e-Zone, among others, has achieved sales turn over of over 1,100 crore in the first 11 months (July 2008- June 2009) of this fiscal. While, this represents an overall increase of 37.36 per cent in sales for this segment, over the similar period of the previous year, there was a decline of 7.85 per cent in ’same store sales’ during the period.

Undeterred by dip in sale of home improvement products due to recession in real estate market, as reflected by reduction in ’same store sales,’ the group is going ahead with its plans to aggressively expand the business of this segment. The Future group is looking at a eevenues of Rs 1,800 crore from its HomeTown stores retail chain.

The decision of the world’s largest home products retailer comes in the wake of the company’s desire to own 100 per cent of equity in its India operations. This, however, is not possible as currently the country allows foreign direct investment of only up to 51 per cent in single-brand retail. IKEA’s hopes of change in the policy guidelines following the installation of new investment friendly UPA government (sans support of the Left) were, however, dashed as the first official statement of the new government as reflected in the President’s address to the parliament did not contain any positive signals on this account. India’s new commerce minister Anand Sharma even went to the extent of saying that there is no poosibility of changing the prevailing investment norms for retail in the near future. IKEA, according to media reports, had not only zeroed in on the site for its first store, but had also employed a few people to set up its new business.

IKEA, though, has not given up on its India plans entirely, as it can not ignore its vast market and wants to be a part of its retail growth story. “In a few years we are bound to reconsider our decision,” said IKEA sources.

While, the new government recognises the importance of opening up the country’s retail sector, it may do so gradually in a phased manner as two of the government’s allies Mamata Benerjee-led Trinamul Congress and DMK are vehemently opposed to the entry of big corporates and foreign retailers in the retail sector. IKEA may have a better luck than multi-brand retailers as the government may consider allowing 100 per cent FDI in speciality single-brand retail and luxury retail, which do not affect fortunes of millions of small traders who for centuries are engaged in retail sector now called ‘conventional’ or ‘traditional’ sector.

IKEA was founded in Sweden by Ingvar Kamprad. It specialises in selling functional products that can be self-assembled by customers. It chose to specialise in selling flat-pack products as they help the company in controlling transportation costs. The popularity of IKEA can be gauged from the fact that its website which displayed a range of around 12,000 products was visited by over 470 million persons in 12 months. IKEA sources its requirements from nearly 1,400 vendors located in around 50 countries across the world. Even, vendors from India account for sourcing of $500 million worth of home products.

“We are focusing on consolidation of our retail business and bring higher operational efficiency before looking for any diversification. Thus, we have put on hold our plans of entering the F&B/restaurants space in India.” said Ambeek Khemka, Group President, Vishal Retail, to DNA.

This makes sense as the company has borrowed heavily in the past to open new stores and finance slow moving inventories. Even if it desires, the company will find it difficult, almost impossible, to raise new resources either from private investors or capital markets for financing the new business.

No lenders will agree to also advance cash as the company is seeking rollover of existing loans. It has in the past even defaulted on payment of a loan installment. Although, the retailer is currently less leveraged than before as its debt/equity ratio has come down from a high of over 3 to slightly above 2.5, it is still still much too high for comfort. The retailer is believed to be still carrying a debt of Rs 720 Cr on its books.

In fact, the group, in order to raise resources, had also sold out its garment manufacturing facilities a few months ago.The value retailer still garners bulk of its revenues from sale of garments, though share of business for this segment in the first nine months of the previous financial year (2008-09) slightly came down from 57 per cent earlier to 53 per cent. The company is believed to have closed the financial year 2008-09 with the annual sales of Rs 1,380 crore. This sale though is much lower than the earlier targeted figure of Rs 1,500 crore.

Despite major growth in sales coming from expansion of retail network, the retailer in the face of cash crunch, during later half of the previous financial year, had put a complete freeze on further expansion of the network. In fact, for further growth, the retailer is looking for franchisees to open new stores. Currently, over 20 stores are being operated by the franchisees (13 up to December 31, 2008).

The retailer has also begun to offer ’shop in shop’ space to independent vendors on rent. The retailer has targeted renting out of 0.2 million sq ft space at the monthly rental of Rs 200 per sq ft.The retailer is also trying to raise revenues by selling ‘display’ space in its stores to FMCG and other players looking for new advertising opportunities. The retailer has also relocated or downsized non-profitables stores and has also closed down 11 of its warehouses on the other.

Westside, the flagship department store format, lifestyle retail chain of Noel N Tata-led Trent Ltd, one of the two retail arms of Tata group, which currently operates 36 stores, recently opened its new store at Nashik in Maharashtra. The new store occupying a retail space of 24,000 sq ft is located in the Untwadi area of the growing commercial city.

“We are very proud to bring the Westside experience to the discerning customers of Nashik. The residents have been exposed to fashion and we hope to enhance this with our superior merchandise, service and an international shopping experience,” said Smeeta Neogi, Head- Marketing, Westside, on the occasion.

Westside, which specialises in deriving most of its business from private labels, is present in 21 cities across India. Of the 37 stores being operated by the company across the country as many as 6 are located in Mumbai alone.

The company, which achieved a sales turnover of Rs 499 crore ding 2007-08, is planning to expand operations of Westside retail chain by opening 10 new stores during the current financial year 2009-10. The new stores are likely to come up in the metro and growing cities of Mumbai, Hyderabad, Kochin, Faridabad, and Guwhati, among others.

High quality, latest in-style products, international shopping experience and value for money pricing have created a loyal following for Westside’s own brand of merchandise. While being trendy they are also individualistic. Almost everything at Westside is exclusively designed for Westside.

‘Westside,’ was founded by Simone Tata in 1998 out of sale proceeds of cosmetics brand ‘Lakme’ to HLL. Trent Limited, the brand’s owner, has now grown into also operating new retail chains under the brand names of ‘Star Bazaar’ and ‘Landmark.’ While, Star Bazaar is a hypermarket format retail chain, Landmark is a books, music, and leisure products chain. Star Bazaar has recently entered into an agreement to set up 50 hypermarket format retail stores in collaboration with the world’s third largest food & grocery retailer Teisco plc of the UK.

Unperturbed by the global economic slowdown and consequent effect on retail business, Sanjay Dalmia, is going ahead with a plan to expand his UK-based home textiles retail chain Rosebys globally. Rosebys, the financially stressed UK-based retail chain, was acquired by Dalmia, over two years ago in 2006, for US$45 million.

With Rosebys acquisaition, GHCL became the world’s only integrated home textiles company with presence across spinning, weaving, product design & development, sourcing and distribution to retail stores at a global level. Even at the time of taking over Rosebys, Dalmia had made his vision clear, saying, “This acquisition provides us with an ideal opportunity to leverage Rosebys’s established platform across the EU markets and a renowned global brand in order to make GHCL one of the dominant player in the Home textile space globally.”

Now, Dalmia sees retail business via Rosebys as the engine for his group’s future growth.

“Going ahead, the growth engine for my business will be retail. We have already started in India and this year would start expanding across the world,” said Mr Dalmia, who wants to see Rosebys become a global retail chain with a turnover of $200 billion (Rs 10,000 crore) in the next five years.

“In five years time, I want Rosebys to be present almost in all the countries in the world… My target is to achieve a turnover of $200 billion (Rs 10,00,000 crore) and become one of the top retailers globally,” said Dalmia in an interview (PTI).

Interestingly, the group’s present turnover is about a mere Rs 2,000- 2,500 crore ($400-500 million). However, justifying the ambitious growth plan, Dalmia said, “You need to be ambitious… you have to think big, if you want to grow big.”

Rosebys kicked off its retail roll-out in India last October with plans to set up 650 exclusive stores by 2012. It has roped in Bollywood actor Soha Ali Khan as its brand ambassador. Rosebys is planning to penetrate the estimated Rs 10,000 crore Indian decor market using the franchise route with 600-1,200 sq ft stores in all metros and Tier-I and II cities.

Reliance Retail, a wholly owned subsidiary of Mukesh Ambani-led Reliance Industries, though it may come as somewhat of a surprise, is slowly but steadily growing its retail network.

Despite media reports reporting closure of around 30 under performing stores, the company has more than doubled its stores count from 465 to 950 stores in the last one year. It has thus added 485 store this year. During this period, the company has also expanded its footprint from 58 cities last year to 77 cities across the country, this year.

The retailer’s first hypermarket format store in Mumbai region was launched on 27th February, 2009 at Thane, located on the northern outskirts of Mumbai city.

The 11th hypermarket store at Thane, occupies a space of 50,000  sq ft spread over three floors. The retailer, had launched its first hypermarket format store at Ahmedabad on 15th August, 2007. Apart from Thane, the company is currently operating 10 more hypermarket stores at Ahmedabad, Jamnagar, Pune, Gurgaon, Faridabad, Jodhpur, Bangalore, Ranchi, Hyderabad, and Tirupati.

Reliance Mart, the hypermarket format of the multiformat retailer, is part of its ‘value’ segment. Other formats in this segment include Reliance Super, Reliance Fresh, Reliance Delight, and Reliance Wellness.

Apart from value formats, the company also operate a number of special formats, including Reliance Digital, Reliance Footprint, Reliance Trends, Reliance Jewels, Reliance Time-Out, Reliance Living Homeware, and Reliance AutoZone, among others. Reliance Retail has also unveiled speciality formats like Vision Express (eye-wear products) and iStore (Apple products) in partnership (joint venture or franchisee) arrangements with international retailers.

Reliance Retail is expected to also launch a chain of ‘apparel and home-ware’ product stores soon in patnership with the UK’s leading retailer Marks & Spencer.

Home Solutions Retail (India) Limited (HSRIL), a subsidiary company of Pantaloon Retail (India), which operates in the home and hard goods consumption space, has raised Rs 150 crore through sale of equity shares.

HSRIL operates several home retail formats– Home Town, Electronic Bazaar, Furniture Bazaar, Collection I and eZone, among others. The key product categories handled by the company include consumer durables & electronics (CDE), furniture, home furnishings & decor, home improvement, and home services including design.

The equity of the company, according to Kishore Biyani, CEO of Future Group, were sold among others to other stakeholders of the company including ICICI Ventures Funds Management and Kotak SEAF India Fund.

The funds so raised will be utilised for expanding the company’s activities in the areas of merchandise for home building and improvement, furniture and consumer durables.

Pantaloon Retail, the country’s largest listed retailer, and parent company of Home Solutions (India), continues to hold over three-fourth of the stake in the company’s equity.

During the financial year ended 30th June, 2008, HSRIL had earned an income from operations of Rs 891.05 crore and incurred a loss of Rs 60.53 crore.

Home Retail segment for Pantaloon Retail has recorded a turnover of Rs 730.38 crore this year (July 08-Jan 09) compared to Rs 492.54 crore for the corresponding seven months last year, thereby registering an overall growth of 48.29 percent. The same stores sales, though, were just 1.36 per cent higher than the previous year. The picture was even worse for January 2009, with same store YOY sales showing a decline of 4.32 per cent for the month.

The observation of the Reliance executives is in tune with Azim Premji’s private equity firm valuing Subhiksha for about Rs 2,300 crore against annual (FY 2007-08) sales of Rs 2,305 crore. Azim Premji, it may be recalled, had paid Rs 230 crore to I-Venture for 10 per cent stake in Subhiksha’s equity in September, 2008.

While, most retailers, following economic slowdown are facing cash crunch due to declining footfalls and customer spendings, Reliance Retail, is not witnessing any such problems. Not only, it has superior parantage than most others, but also has no major debt-payment obligations like others. (While, both Subhiksha and Vishal are highly leveraged, even the retailers like Pantaloon Retail (Future Group) and Shoppers’ Stop are leveraged more than the previous year).

To fight out the slowdown, Reliance Retail, though is fine tuning its growth strategy. It will now focus on ’speciality’ format more than its ‘value’ formats.

“We will shift to a slightly lower gear, but will still keep growing. The speciality format is just coming out of pilot phase. Now, we will scale it up,” said the executives.

Reliance Retail, after having established about 750 stores of ‘value’ formats comprising Reliance ’Fresh’ (convenience), ‘Super’ (mini hypermarket) and ‘Mart (hypermarket) in about 27 months, will now focus on ’speciality’ formats that until now were still in a nascent stage. Reliance Retail’s speciality formats include, Reliance Trendz (apparel), Digital (consumer electronic & durables), Footprint (footwear), Jewels (jewellery), Wellness (health and wellness), TimeOut (books, music, leisure), Homeliving (homeware and furnishings), Vision Express (Eyewear), iStore (Mac products), Office Depot (stationery and office products).

The last three formats of the company are in alliance with international retailers, who are giants in the field and geography of their operations. These alliance are based on either franchisee or partnership (joint venture) arrangements. Reliance Retail has also formed a joint venture with the UK-based Marks & Spencer for selling fashion and homeware in India under single brand retail policy guidelines of the Indian government.

Pantaloon Retail, the retailing arm of Kishore Biyani-led Future Group, which also happens to be the country’s largest listed retailer, despite organising a shopping bonanza for better part of December, 2008, has not been able to stem the declining ’same-store’ sales during the month as compared to same period in the previous year (December, 2007). Overall sales across formats during December, 2008 at Rs 494.68 Crore for December, 2008 were 6.92 per cent lower than Rs 531.41 crore achieved during December, 2007.  The monthly decline has been reported for the first time in the past four years.

What is more surprising is that the decline occurred across all the segments; Value (Big Bazaar, Food Bazaar), Lifestyle (Pantaloons, Central, e-Zone), and Home (Home Town).

Even Kishore Biyani, Pantaloon Retail’s Managing Director and CEO of the group, who was surprised with the numbers, attributed the decline to “unpredictable” times.

What, however, is not so surprising, given the current economic downturn, is the fact that while the decline in the lifestyle segment at 14 per cent is highest, it is slightly lower at 10 per cent in the Home segment. Both these segments are prone to sharp declines as large part of their business falls within the ambit of discretionary spending. attract large discretionary spending. The decline in value segment, which accounts for almost two-thirds of all sales, was restricted to a mere 3.5 per cent.

Apart from international apparel labels, electronics and home furniture have been held responsible for dip in December sales of the company.

Biyani is confident, however, of reversing the situation in January, 2009, in which the company in the past few days has already recorded a growth of 18 per cent, over the previous year. Although, the stretched shopping festival of the company has already ended on the 11th January, the company should be able to achieve a double digit figure during the month.

It should be noted, however, that for first six months of the current fiscal (July-December 2008), ’same-store’ sales for lifestyle, home, and value segments have shown growth of 4.53, 2.66, and 8.45 per cent respectively. Overall growth for the six months period in 2008 at Rs 2,765.29 Crore was 6.98 per cent higher than the same period in the previous year 2007.

Comparison of sales and other performance parameters for the stores that were in operation even twelve months ago from the period of comparison, is an important barometer of any retail company’s health as addition of new store sales and other figures can always mislead the analysts.

Gianni Versace, among the most famous Italian fashion designer, marketer, and distributor of luxury clothing, accessories, fragrances, makeup and home furnishings, is getting ready to launch its super premium store later this month at the Oberoi Trident Hotel in Mumbai.

The Oberoi Trident, it may be recalled, was devasted in a terror attack, less than a fortnight ago on the 26th November, 2008.

Versace has not been been dettered by the terror attack, though, senior officials of the group from Italy, according to a DNA report, were caught in the terror attacks at the Oberoi-Trident.

The €340 million Versace s P A was founded by Gianni Versace in 1978.

“We will open the first Gianni Versace store at Trident by December-end instead of mid-December as was previously planned. This will be followed by the launch of the flagship Gianni Versace store spread across 4,000 square feet in Emporio Mall, Delhi, in February 2009,” said Abhay Gupta, Executive Director, Blues Clothing Company, Versaces’ India franchisee.

While, the Versace Collection and VJC exclusive stores have earlier been opened in Delhi, the group is now launching the Gianni Versace stores in India. The franchisee company also retails and markets licensed brands like Corneliani, Trussardi, Cadini, besides Versace Collections, Gianni Versace and VJC in India. “We are bullish on the premium retail destination of south Mumbai and the luxury market in India,” said Dinesh Sehgal, managing director, BCC.

Rosebys, the well known UK retail brand for interiors including home furnishings, which two years ago was bought over by the soda-ash and textiles major Gujarat Heavy Chemicals (GHCL), has according to an ET report, roped in Soha Ali Khan, Bollywood Actor, as its brand ambassador for India rollout.

Rosebys, according to its Chief Executive Officer Aloke Banerjee, will spend Rs 250 crore on brand building in the next four years.

Rosebys, which is planning to target young women in 25-35 years age group, will introduce four theme-based broad lines including Eco Chic, Geo Retro, Indulgence and Peony Garden. Initial plans include introduction of 75 design combinations in India. These have been designed by the retailer’s design  houses in the UK, the USA and India.

“We are for giving an all-inclusive luxury home solutions at an affordable price,” said Banerjee.

“We will start our Indian roll-out with 150 franchise stores within the next six months in all metros, Tier-I and Tier-II cities. Our plan is to set up 650 stores by 2012,” informed Banerjee.

Rosebys, wanting to emerge as a leader in the affordable luxury brand segment, is eyeing a turnover of Rs 1,000 crore in the FY 2011-12.