The Rs 6,600-crore (Rs 66 billion) RPG group is giving a strategic facelift to your friendly neighbourhood grocery. The Kolkata-based group is entering this segment through FoodWorld Express, a modern kirana outlet chain.
Raghu Pillai, president, retail business of the RPG group, said, "We are looking at this retail format, basically selling daily consumption items. The format will be on test-marketing in Chennai, Bangalore and Hyderabad and will be located in residential localities."
The group will be the first organised player to enter this segment of the retail business. FoodWorld Express will be an extension of its FoodWorld chain of supermarkets.
FoodWorld is a joint venture between the group and its international partner, Dairy Farm International. The $3.7-billion Dairy Farm, part of the Jardine Matheson group, owns a 49 per cent in FoodWorld Supermarkets and the rest is owned by the RPG group.
At present, apart from FoodWorld, RPG Enterprises has three retail brands: MusicWorld, Giant and Health & Glow. The retail arm of the RPG group--which has interests in tyres, tea, information technology and the entertainment sectors--accounts for over 6 per cent of its Rs 6,600 crore (Rs 66 billion) annual turnover.
According to industry estimates, India's retail business is poised to grow at a rapid pace over the next few years. Meanwhile, the group is launching Giant, its hypermarket format in Mumbai, which will mark its debut in the city. The two stores in Mumbai will come up at Mindspace in Malad (suburban Mumbai) and in Thane. The Giant, launched in Hyderabad in 2001, plans to open more such marts across the country.
According to Pillai, hypermarkets are the fastest growing format in the retail industry. This is because of the price proposition as hypermarkets sell goods below the printed maximum retail price.
Giant stocks a huge array of goods from consumer durables, kitchen appliances, basic staples, luggage, groceries, dairy products and apparels. "We would like to be in 20 cities over the next five years," Pillai added.
