“Montblanc Services BV has applied for approval for 51 per cent FDI in single-brand trading of Montblanc products,” a government source told The Indian Express, adding that while the German company applied to the department of industrial policy and promotion (DIPP) early this week on Tuesday, Lush Ltd applied a few weeks ago.
Earlier this year, the German company had entered into a 51:40 joint venture with Titan Industries of the Tata Group, to enhance its footsteps in India. Last year, it opened its first pop-up store in Mumbai. Popular in countries like the US and Britain, these shops are temporary in nature and sell goods for a limited period of time, then shut down and move elsewhere. Besides pens, Montblanc, part of the Richemont Group, sells high-end accessories including watches, jewellery and leather goods. Besides Montblanc, the group owns several companies including Cartier, Piaget and Constantin.
By forging a JV with Titan, the German brand will be able to circumvent the 30 per cent mandatory sourcing norm required in the single-brand retail sector. The government allowed 100 per cent FDI in the sector in 2012.
Further, Lush, which operates over 900 brands globally in over 50 countries, is also set to enter the country with its first shop opening in Delhi. According to its website, the UK-based company is expanding globally, opening a shop and spa in Sao Paulo, Brazil, which will be its flagship store for South America. The store is expected to open in the first half of the current year. The company is also investing in a factory in Brazil which will supply to the rest of South America. The company already sources products including saffron and jasmine from India.
With the government allowing 100 per cent FDI in the sector, several global players have evinced interest in the Indian market. So far, the biggest single-brand retail proposal cleared by the government came from Swedish furniture retailer Ikea. The company will invest Rs 10,500 crore to open 25 stores in India in the next 10 years.