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Bindu D. Menon

New Delhi, March 7

Kidswear brand Lilliput is looking at countries such as Syria and Egypt for contract manufacturing its apparel and accessories range, even as the company has entered into a joint venture with a Chinese company to step up its retail presence in the Dragon Land.

“Syria and Egypt offer immense potential for cost reduction. We are looking at contract manufacturing from these nations,” Mr Sanjeev Narula, Managing Director, Lilliput, told Business Line.

The company currently has a contract manufacturing arrangement in China. Lilliput has entered into joint venture with Shenzhen New World Development company for its retail venture. The 51:49 venture will be called Lilliput Kidswear China.

“We hope there will be at least six retail outlets in China by the end of this fiscal through this joint venture. China is an extremely good market for organised retail. If the average retail price of merchandise in India is $14, the same is $25 in China, which brings in higher margins,” he added.

Backed by a Rs 45-crore private equity infusion from Indivision, the financial arm of Future Group, the company is looking at stepping up its presence in the domestic market as well. “We plan to take the number of retail outlets from 145 to 270 by the end of this fiscal,” Mr Narula said, adding that tier-II and III cities will also be part of the expansions.

The company said it will close the year with a turnover of Rs 260 crore for 2007-08.

Lilliput, which also does contract manufacturing for several global players, said exports contribute to as much as Rs 115 crore of the total turnover.

The market for kids apparel in India is pegged at Rs 14,000 crore, of which Rs 3,000 crore is constituted by branded kidswear. The segment is growing at a rate of 20 per cent per annum.

The company has earmarked Rs 12 crore towards branding and promotions.

More Stories on : Retailing | Alliances & Joint Ventures | Readymade Garments

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