The RP-Sanjiv Goenka Group, which is going ahead with a major restructuring move, has chalked out a “very robust plan” to increase revenue of its retail chain Spencer’s Retail by double-digit as the primary aim of the retailer at this point is to become profitable as a company. Turnover of Spencer’s Retail (SRL) soared over 8% year-on-year at Rs 2,021.27 crore in the last fiscal. Consequently, its net loss narrowed to Rs 129.39 crore in 2016-17 from Rs 142.28 crore in 2015-16. “Our primary aim I think at this point is to become profitable as a company. We are very close to it…We have all our things in place to ensure that hopefully this fiscal we will be Ebitda positive. Once we finish this milestone, we will become profitable at the PAT (profit after tax) level,” Shashwat Goenka, Sector Head, Spencer’s Retail, told FE in an interview.
With the company, part of the Rs 20,000 crore Group, improving its operational performances, its EBITDA loss was contained to Rs 17.10 crore in the last financial year against Rs 52.80 crore in the previous year. Last fiscal, SRL’s average revenue per square foot stood at Rs 1,576 per month and it registered a same store sales growth of almost 9%. “We have a very robust plan in place to increase our revenue by double-digit across the food and non-food categories. Part of it will come from new stores that will be opened, and part of it will be from existing stores itself. Our existing stores’ sales can grow at a good double-digit level, and therefore revenue per square foot will only keep growing,” said Goenka.
Spencer’s currently has over a 120 stores, including 39 hypermarkets, in more than 40 cities across India. It plans to roll out about 10 new stores, including five hypermarkets, this fiscal. As compact hypermarkets (large format stores) remain important for it, the retail player is looking at opening over 60 compact hypermarket stores in the next five years.
Goenka said SRL will explore the possibility of launching more own brands segment-wise, keeping in mind that it is very important for a retailer to keep growing its own brand portfolio as that gives a scope for differentiation between competitors.