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Preeti Mehra
Anil Sasi

New Delhi , March 11

MIRZA Tanners Ltd, a global player in leather exports, is planning a Rs 100-crore investment drive to diversify into related businesses, including company-owned retail stores, a ladies shoe factory and a leather upholstery tannery.

The company, which is planning to fund the expansion drive through a mix of internal accruals and borrowings, aims to clock a four-fold increase in turnover at Rs 1,000 crore in the next five years.

First and foremost, it is turning its international brand Red Tape into a retail brand for men's products. Apart from the shoes that it sells under the label, the company-owned Red Tape retail stores across the metros will stock all men's needs under one roof, including garments, personal care products, sun glasses and other accessories.

To start off with, Mirza Tanners is putting into place a string of company-owned Red Tape retail stores. This would set into motion an expansion drive that would include the re-modelling of Red Tape's existing shoe franchisee stores into the entire men's fashion range, and increasing the company's `Shop n Shop' concession stores that are housed in big retail stores such as Ebony and Shoppers' Stop.

"We are looking to have a presence in the major metros and bigger towns and plan to start with two each in Delhi and Mumbai and one in Chennai, Hyderabad, Bangalore, Chandigarh, Pune and Kolkata. We are planning to open the first ten across the country on the same day, hopefully September 1," Mr Rashid Mirza, Managing Director, said.

The retail division of Mirza Tanners under which the entire project would be run, is to be based in Mumbai, where the company is setting up a design studio that will employ exclusive designers to design Red Tape products.

The garment and accessory manufacturing, however, will be outsourced in the same way, as the Red Tape shoes will be outsourced from the company itself, he said.

"We are basing the entire retail business in Mumbai as it the only city that has the expertise for such an outsourcing exercise," he said, pointing out that internationally every fashion brand, be it Prada, Armani, Calvin Klein or Gucci, use the outsourcing model. The company plans to take the Red Tape fashion brand overseas once the Indian operations get underway. "We will start with the Far-East and West Asia,'' he said.

Though the Red Tape fashion brand is going to be the glamorous part of the diversification, it would involve the least investment. Mr Mirza put the figure at around Rs 5 crore for the initial project.

However, the ladies shoe factory in Greater Noida will entail an investment of around Rs 50 crore, while the leather upholstery tannery coming up in Unnao, near Kanpur, would need over Rs 40 crore, roughly adding up to a Rs 100-crore investment in the next two years. Both plants would be up and running by the end of the year.

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