Spencer's Retail, promoted by the Rs 11,500 crore (Rs 115 billion) RPG group, is in talks with international retailers for a possible joint venture in India. The company is exploring the JV route to introduce new formats.

However, Sanjiv Goenka, vice-chairman, RPG Enterprises, declined to comment on the JV partners and the new formats.

"The JV will not be in the food retailing since our existing formats function in that area. We are talking to a couple of international players. The new venture will be consolidated by the group. Hopefully, we will be able to take a call on the new venture in a couple of months," said Goenka.

Goenka further said the JV would adhere to the FDI guidelines. He added: "We will locate stores in such a way that they do not clash with business of existing stores."

Spencer's currently has 250 outlets in 40 cities. The company will open 500 stores in the next 12 months and 600 stores next year. The company was planning to invest Rs 1,100 crore (Rs 11 billion) to expand its network of stores, he added.

The company will use a mix of internal accruals, debt and equity to fund the expansion. It would take a call on the initial public offer in the next six months, he said. The company expects a turnover of Rs 2,500 crore (RS 25 billion) to Rs 3,000 crore (Rs 30 billion) a year in the next two years. Currently, the company has sales of Rs 750 crore (Rs 7.5 billion).

About how the company has geared up to tackle competition from RelianceMart, Goenka said: "There is enough scope for all the retailers. For instance, in Chennai we have 42 stores and all the big retailers, including Big Bazaar, Subhiksha and Thrinetra also function. Despite this, in Chennai stores, we have the highest per sq foot sales among our stores in the country," he said.