The Hindu Business Line : Koutons keen to open more family stores

New Delhi, July 1 Apparel retailer Koutons Retail has said it is keen on opening more family stores where clothing lines co-exist with accessories and footwear. The company is focusing on converting its existing stores to cover larger retail space rather than opening new stores.

The company, which declared its results today, said its net profit rose marginally to Rs 35.82 crore in the fourth quarter ended March 31, 2009, against Rs 35.55 crore in the corresponding quarter last year.

Total income rose to Rs 378.90 crore (Rs 371.90 crore).

For 2008-09, the company posted a consolidated net profit of Rs 79.53 crore, up 15.01 per cent from Rs 69.15 crore in the previous year. The net sales stood at Rs 1,046.68 crore (Rs 793.46 crore), registered a growth of 31.91 per cent.

Funds for expansion

“Cost cutting has become mandatory to sustain the business. Our revenues are growing; we are expanding to include larger number of family stores. Most of the expansion will be through franchise managed stores as it involves lesser capex. For the current year, the capex will be close to Rs 50-60 crore,” Mr D.P.S. Kohli, Chairman, Koutons Retail, told Business Line.

The company plans to fund the proposed expansion through debt. “We have a comfortable debt-equity ratio. We will raise debt for the expansion programme and will dilute stakes further only if the need arises,” said Mr Kohli.

It is looking to take the number of its stores to 2,000 from the present 1,400 by the fiscal-end.

Last year, it had entered the footwear retail business under the K21 brand name. “We have tied up with a shoe manufacturer and invested Rs 50 crore to set up a plant in Uttarakhand exclusively to cater to our footwear retail venture”.

Koutons Retail brands include Koutons, Charlie Outlaw, Les Femme (targeting women) and Koutons Kidswear, besides an innerwear line for men.

On its overseas foray, Mr Kohli said it is consolidating its position in the domestic market and has temporarily deferred its plans to enter West Asian and Chinese markets.

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