RP Sanjiv Goenka Group?s company Spencer?s may open a separate back-end firm to run its retail business after the government?s move to allow 51% FDI in multi-brand retail and 100% FDI in single-brand retail.

Talking to the media on Friday, chairman Sanjiv Goenka said the government move will the help the back-end sphere of the retail business turn into profit centres with more investment pouring in. Once the back-end part gets more investment, it will help improve the front-end margins, he said.

?There is a distinct possibility that Spencer’s will float a separate back-end company to run its retail business and I suppose all other players ? the Birlas and the Reliance ?are thinking on these lines,? said Goenka.

Another Kolkata-based company, Keventer Group, which has been setting up back-end infrastructure for the last few years, is going to invest R78 crore in cold chain logistics over the next 18 months. ?We are setting up a million sqft of warehouse near Barasat,? said Mayank Jalan, MD, Keventer Group.

Keventer has already executed a half a million sqft warehouse chain which is being used by the Future Group and the Aditya Birla Group. Though Jalan won’t confirm it, there’s speculation that the group is in talks with foreign retailers for the back-end business as it already enjoys the first mover advantage.

Floating a separate company for the back-end business would attract investors ( both foreign as well as domestic), which, with a flush of cash, could help procurement, warehousing and supplying to the front end in a more cost-effective way and reduce wastage, said Goenka. Goenka pointed out that a lot of consolidation could happen at the back end with a multinational serving a number of retail chains.

?A multinational can serve Spencer’s and other retail chains too,? Goenka said, adding that consolidation with multinationals would happen at the beginning, but that with Indian players at the back end would take some more time.

?We are open to FDI in both the back end and the front end of our retail business, but we won’t give majority to any one who would like to be our partner,? Goenka said.

He said Spencer’s was talking to a number of global retail majors, though he didn’t name any. He ruled out any advancement of talks with Carrefour, though the two have been in talks for a long time.

Spencer’s expects its top line as well as its area of retail operation to grow in the coming fiscal, though he didn’t quote figures. Spencer’s would make R350 crore of capital expenditure in 2012-2013, but didn?t want to mention whether FDI would be part of it.

He said the retail sector would see the results of the FDI move in the next 18 months, by when the players could plan their areas of investment.