Medicine retail chain Guardian Lifecare has earmarked Rs 100 crore towards retail expansion.

Margin-drivers

With healthcare- and pharma-vertical on an upswing, the company said private labels are margin-drivers in the business. Speaking on the retail expansion, Mr Ashutosh Garg, Chairman, Managing Director, Guardian Lifecare, said the company has 230 stores in 26 cities across the country.

“There is a demand explosion in the branded pharma business. To meet this demand, we will be aggressively expanding to add 100 stores each year. This will entail an investment of Rs 100 crore,” he said. The company, which so far has been following a company-owned-and-operated model to expand, said it is also experimenting with the franchise model to expand.

“Private labels are decent margin earners and we have about 230 products under our brand umbrella. Since these are about 30 per cent cheaper than well-known brands, we see the demand going up in near term,” Mr Garg told Business Line .

Private labels

Guardian's private labels are in categories like personal care, over-the-counter, sports nutrition and vitamins, among others.

“We started our franchisee model in December last year. We are also looking at setting up shop-in shops at retail outlets like More, Wal-Mart and Spencer's among others,” Mr Garg added.

He said the investment would be funded partly through internal accruals and private equity investment.

Mr Garg said the average size of its store is around 700 sq. ft.

Revenue

The company, which clocked revenue of Rs 110 crore in March 2010, said it hopes to end this fiscal at Rs 170 crore.

“Our same-store growth has been around 25-26 per cent,” he added.

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