RPG Group will invest Rs 1,000 crore (Rs 10 billion) in the next one year to expand its mobile and laptop retail chain, run by RPG Cellucom India -- a master-franchisee of Dubai-based Cellucom.
RPG Cellucom India, which currently runs over 100 stores across the country showcasing a variety of products, including phones, notebooks and other accessories, will open 400 new stores by December next year targeting Rs 2,500 crore (Rs 25 billion) turnover by March 2009.
Of the new stores, "150 will come up by this year end", RPG Cellucom Chief Executive Sunil Bhagat said at the launch of the 101st store in New Delhi. He said the company will have over 50 stores in the National Capital Region by March 2008.
As per an agreement between the two companies, RPG Group will make the investment required for setting up the infrastructure, while Cellucom will help in procurement of products from manufacturers and provide other back-end support.
Commenting on the potential of the Indian market, Cellucom Founder and Managing Director Arun Nagar said the company expects around 70 per cent of its global revenues to come from the country in the next three years.
With a turnover of over $350 million, Cellucom is a leading brand in the Gulf Cooperation Council and Africa.
Cellucom also has an option to buy a 50 per cent stake in RPG Cellucom India subject to policy regulations. "We can buy a 50 per cent share in the company when FDI issues are clear," Nagar said.
The planned number of outlets in India will cover the entire value chain in formats like stand-alones in malls and high streets, as well as shop-in-shops within Spencer's, Music World, Shopper's Stop, Lifestyle and other large format stores.