HyperCity, the hypermarket chain of K Raheja Corp Group, which launched its first store in Mumbai in May 2006, is expanding the number of its stores by the end of this financial year (2010-11). HyperCity currently has a presence in six Indian cities – Mumbai, Bangalore, Hyderabad, Jaipur, Amritsar and Bhopal ? through eight outlets. HyperCity officials did not divulge the investment needed for this expansion, but in 2007, the retail major had reportedly invested around Rs 1,100 crore for expansion till 2010.
In an analyst call recently, BS Nagesh, vice-chairman, HyperCityRetail India, stated that the company plans to expand its footprint in the southern and western regions of India. Six to eight stores will be launched every year, with the store-size varying from 75,000 to 1,00,000 square feet. The cities that are slated to witness a spurt in Hypercity stores by the end of FY11 are Pune, Ahmedabad, Ludhiana and Bangalore. Low levels of urban development and a very different consumer market in the east, have deterred the company from spreading its base there.
Ashustosh Chakradeo, head ? buying, merchandising and supply chain, HyperCity Retail said, ?The company aims to open stores in a cluster, thus hoping to bring down its operational costs. Around four new stores are likely to be seen by the year end. We would also like to have more local distribution units. Currently, we have only one central distribution unit at Bhiwandi in Mumbai.? Commenting on HyperCity?s special focus on Bangalore, he said, ?Bangalore is the pinnacle of organized retail in the country. Hence, you can expect about three more stores there in the near future.?
The Indian market has enough potential that is yet to be tapped, feels Chakradeo. He added, ?Large-format stores and hypermarkets are in now. Customers are welcoming the quality, range, presentation and ambience that every Hypercity store offers. We look to provide them 34 new categories of products including 10 private labels, by the end of FY11.?
Despite posting a net loss of Rs 13.84 crore in the second quarter of FY11, HyperCity is buoyed by its healthy like-to-like growth of 25%. ?Three of our eight stores are less than a year old, hence the company has run into a net loss. But we have picked up now.
