Among the pioneers of organised retail in India, Shopper’s Stop may be up for sale if The Economic Times is to be believed. Though the management has dismissed the news as ‘baseless rumours’.
If the deal happens, it would be the second major deal in retail space in recent times after the Indiabulls-Piramyd buyout.
Shopper’s Stop is owned by the K. Raheja Group which has interest in real estate development and hotels, and was the first retail company to be listed on the stock exchange.
According to reports, the group is looking for a buyer and the among the list of potential suitors, Reliance Retail and Aditya Birla Retail tops the list. The company inspite of being in retail business since 1991 is facing margin pressure and reported profit of just Rs.1.56 crore for Q3FY08. It has also not been able to expand as rapdily as other players like Pantaloon and operations is still confined to metro cities.
Shopper’s Stop gels perfectly with Reliance Retail as both are multi-store format retailers. Apart from being India’s biggest Department Store chain, it has other retail formats which include HomeStop (Home Concept store), Crossword (Bookstore), Stop & Go (Airport Retail), Brio (Coffee Bars) and Desi Cafe (Fastfood). Other than that, it has links with Hypercity, Mothercare, M.A.C. (Cosmetics) and Time Zone (FEC).
If indeed Reliance Retail manage to get Shopper’s Stop, it would be a welcome move as it would get hold of prime retail space across the country and also complement its existing store formats.