Reliance Retail presses fast forward

This could well be the Wal-Mart effect. Reliance Industries Ltd (RIL) appears to be ready for the next stage in its fledgling retail business sooner than planned. So, after the neighbourhood convenience stores called Reliance Fresh across Hyderabad, RIL has also begun the cash & carry format through ‘Ranger Farm’ outlets in NCR.

It’s now gearing up for the launch of Speciality Stores and Hypermarkets over the next two months.

In fact, the new retail blueprint involves Reliance pulling up retail shutters across several cities in the next few days — Jaipur, Delhi and NCR, Kochi, Bangalore and Chennai.

The first Ranger Farm outlet, which acts as a wholesale supplier of fresh fruits and vegetables to push-cart vendors and others, has made its debut in Hyderabad recently and another one is coming up in Jaipur next week.

So, while on the one hand, the Fresh stores service individual customers and households, the Farm (which will have dedicated outlets functioning between 2 am and 9 am every morning) supplies the same produce and groceries to wholesale customers such as vegetable vendors and others.

Then, the first Hypermarket is expected to come up in the National Capital Region (NCR) and Ahmedabad by the end of February next year. Does the arrival of Wal-Mart on the Indian retail scene have anything to do with RIL fast forwarding its roll-out?

Industry experts agree, pointing out that the company’s foray into the cash & carry wholesale trade could provide tough competition to the Bharti, Wal-Mart joint venture.

The RIL hypermarkets would be spread over 50,000 sq ft and would stock consumer electronics, apparel and home furnishings, besides fresh fruits and vegetables. The Speciality Store format is expected to launch with high-end apparel initially.

RIL chairman Mukesh Ambani has declared an investment of about Rs 25,000 crore in the first phase of retail expansion. Of this earmarked investment, Rs 10,000 crore has already been approved as equity.

The retail blueprint will see RIL reaching 784 towns, 6,000 rural mandis and 70 of the country’s top cities over the next 18-24 months. The company is eyeing retail space of 100 million sq ft under its belt by the turn of the decade, a turnover of Rs 1,00,000 crore and breakeven within the first year of operations.

Source : DNA Money