The Hindu Business Line : Welspun Retail mulls IPO by year-end

Mumbai, Aug. 30 Welspun Retail Ltd may come out with an initial public offering later this year to fund its expansion of retail outlets, said Ms Dipali Goenka, Director, speaking to Business Line.

The company is a subsidiary of textile company Welspun India Ltd, serving its retail business, and has set up 100 stores in two years. “The company plans a turnover of Rs 150 crore by the end of this financial year with 300 stores of Welhome and 30 of Spaces pan India. By 2010, we hope to have 800 stores and a Rs 500 crore turnover,” she said.

Welspun Retail plans to double its investments for the next year, she said, without revealing the figures. The company had a turnover of Rs 60 crore last year.

Welhome, with an average carpet area of 800 to 1,000 square feet, entails an investment of Rs 650 per square feet, while Spaces, its premium store of 1,000 to 1,200 square feet, requires a slightly higher outlay.

Sixty to 70 per cent of Welhome stores are in malls but gradually, as the company sets up more stores, most will be in high streets in tier-II and tier-III cities. Currently, the ratio of franchisee to company-owned stores is 60:40.

Product-mix

The product-mix in the stores is 40 per cent of bed and bath items, manufactured by the mother company Welspun India, while the rest is sourced from diverse vendors.

Welspun Retail hived off in 2006 from the mother company as export and retail together got diluted, said Ms Goenka. Though they are the same company, the transaction deals are handled differently, she explained.

Welspun India Ltd’s shares closed at Rs 55.95, down by 0.09 per cent from the previous day’s close.

More Stories on : IPOs | Retailing | Textiles

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