The retail division of the RPG Group will double its total retailing space from the existing level of 10 lakh sq.ft. within the next 18 months, according to Mr Sanjiv Goenka, Vice-Chairman of the group.
Addressing a press conference, he said that the total investment for expansion in the retailing space would be approximately Rs 200 crore and would be funded mostly through internal accruals and a part of it will be through debts.
Subsequently, the total retailing space would be increased to 40 lakh sq.ft. spread across all major cities of India.
The group also unveiled the new logo of Spencer's, which will be the umbrella brand of its entire retailing activity. According to Mr Goenka, Spencer's is on the verge of a massive expansion in all the regions.
The retailing business has been restructured and four separate formats have been created. These have been named Spencer's Fresh, Spencer's Daily, Spencer's Super and Spencer's Hyper. However, MusicWorld has been retained as it is.
"In the new logo of Spencer's, we have tried to give a contemporary feel in the true Indian colours. We have also tried to relocate the brand and place it among the age bracket of 20-45 years," he said.
He also said that nine new hypermarkets would be opened in the next six months. Of these, seven would be in Delhi and other two in Aurangabad and Hyderabad. The first retail outlet in Delhi will be inaugurated on Thursday.
According to Mr Goenka, the annual revenue from the retail business is currently at Rs 321 crore and it is expected to grow to Rs 2,000 crore by 2007-8. He added this was a conservative estimate.
He, however, agreed that the business is yet to register a profit before tax. "It will take some time. Hopefully, we may breakeven in the next year," he said.
Mr Goenka, once again confirmed equity dilution and a probable IPO (initial public offering) of the Great Wholesale Club Ltd, the company which owns the retailing business.
"We cannot give you any date but it is likely to be next year. However, we are not in any great need for funds. The IPO exercise will be more of a valuation of the company," he said.