Financial DataSalesFinancial Year Ending March•2017: USD1.57bn•2016: USD1.32bnIndia Food & Drink Report | Q3 2018bmiresearch.com53
Future RetailSWOT AnalysisStrengths•Its rapid expansion prior to the arrival of multinationals allows it relatively free access to India's wealthiesttowns and cities.•Continued innovation and expansion of its product offerings could help the company secure a strongermarket share.•Future Retail's lower-value private-label offerings will very likely garner strong appeal among Indianconsumers and support its ambitions of building up a stronger market share.•A multi-format operation allows Future Retail to cater to a wider range of Indian consumers and a broaderrange of shopping needs.Weaknesses•With India as its sole location, Future Retail is unable to call on profits from elsewhere to fund Indianexpansion, and is dependent on remaining profitable.•Remaining profitable and pursuing expansion are challenging in a price-sensitive market.•The retailer's ambitious expansion plans will require major investment in distribution and new stores.Opportunities•Discount stores provide access to lower-income groups.•Convenience stores allow for expansion opportunities once major towns and cities start to crowd, in linewith current development rates.•A rural retailing partnership with Godrej's Aadhar network will give the company very early, competition-freeaccess to an enormously promising sub-sector.•By being among the first to establish a multi-format grocery network and a multi-tiered private-label range,Future Retail can position itself at the forefront of domestic retail innovation.•The merger of retail activities will Bharti Retail will increase the group's market share and bargaining power.•The joint venture with Booker will allow for the growth of the cash & carry format in India.Threats•With the further relaxation of foreign direct investment regulations, Future Retail can expect to have itsmarket share pressured and could even become a takeover target.•Future Retail needs to find efficiencies and improved funding if it is to sustain this pace of growth and wardoff the threat of increased competition.Company OverviewFuture Retail (formerly Pantaloon Retail India) is India's largest diversified retail company, operating an extensive range of food andnon-food retail interests. Future Retail operates grocery retail outlets under the Big Bazaar hypermarket, Food Bazaar supermarket,Value discount store and KB's Fair Price supermarket banners. Its operations currently cover 80 cities.StrategyFuture Retail, the leading mass grocery retail player in India, is likely to look forward to years of strong growth. Increasing affluence inIndia over the coming decade will encourage more consumers to turn to modern retail formats in search of the convenience andquality they desire and can increasingly afford. This will mean a rapidly growing appetite for Future Retail's modern retail offerings.
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- Summer '18
- Sagar Arora
- ........., Alcoholic beverage, Food processing