Croma may rope in Tata Group co for durable financing.
Mumbai, Sept. 2 Infiniti Retail, a subsidiary of Tata Sons, with its Croma brand of retail stores, is expecting to cross a turnover of Rs 1,000 crore this year. With Tata Sons having injected a total capital of Rs 220 crore (the debt component is Rs 150 crore) into the durable retail venture, Infiniti Retail is hoping to break even next fiscal.
At a press conference, Mr Krishna Kumar, Chairman, Infiniti Retail and Director of Tata Sons, said, “There is a great deal of interest by private equity players but we are waiting for the right time to get the correct valuations.”
With growth rates hovering at 14-15 per cent on a same store level, Croma will be having 52 stores by 2010. “Seventeen-eighteen of our stores are already profit neutral and we should be breaking even by the next financial year. Each store currently has an annual turnover between Rs 30-35 crore,” he added. Besides, Croma may also look at roping in one of the Tata Group companies for durable financing on the lines of the Future Group. Currently, it has Bajaj Finance as one of its partners for providing loans to consumers but in the future, there is a possibility of Tata Capital being roped in for the same purpose.
As Mr Ajit Joshi, Managing Director and Chief Executive Officer, Infiniti Retail, said, “We are not planning to launch a finance arm but are negotiating with a couple of companies as banks have withdrawn lending. It could also be a Tata Group company.”
Meanwhile, the Rs 657-crore Infiniti Retail has been widening its product portfolio under its own private label.
Expecting almost 20 per cent of its turnover to come from its private label, Croma has added new categories such as LCD panels and notebooks. It is expecting its private label brand to cross a turnover of Rs 100 crore by 2011.