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Govind Shrikhande, MD, Shoppers Stop Ltd, expects the large-format retailer to swing back into profit in the fourth quarter of this year.
“We’re going to see the benefits of the divestment from HyperCity and the investment by Amazon kick-in by then,” he told BusinessLine .
Once the pioneer of departmental store retailing in India, Shoppers Stop has fallen on hard times. For the September 2017 quarter, the company reported consolidated loss of ₹18.5 crore, widening from the ₹8.78-crore loss it reported in the year-ago period. Standalone loss for this quarter was ₹21.8 crore.
The company reported exceptional loss of ₹33.78 crore due to impairment in value of investments in its subsidiary HyperCity Retail.
“There was a GST overhang for us this quarter,” Shrikhande told BusinessLine after the quarterly earnings was announced. “We were facing supply side issues in July and August. But we saw sales improving in September and during Diwali.”
Through this year, the K Raheja group company has focussed on cleaning up its balance sheet – selling the loss-making and debt-laden grocery retailer HyperCity to Kishore Biyani’s Future Retail, exiting its airport duty-free retailing venture with the Nuance group – and partnering with Amazon India to get better online presence.
“With the HyperCity sale, ₹441 crore of debt moves out of our books. We’re going to see our catalogue up on Amazon India by December. We get 4 million customers every quarter, Amazon India has 400 million. So our sales are bound to benefit, even if we get at least one per cent of Amazon’s visitors.”
Shoppers Stop reported revenue from operations of ₹837.6 crore for the quarter against ₹954.4 crore in the corresponding period last year. EBIDTA for the quarter stood at ₹56.7 crore.
It plans to open 3 more stores this fiscal, in Thane, Chennai and Guwahati.
“Now that the consolidated has gone out (with the sale of HyperCity and Nuance), we’re going to focus on the standalone business. We want to focus on sales of our private labels and improve the shopping experience for customers.”
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