Spencer’s Retail sees over three fold rise in sales

Abhishek Law Kolkata | Updated on August 19, 2021

The retailer’s gross merchandise value has climbed to ₹118 crore in Q1 FY22

Spencer’s Retail, part of the RP-Sanjiv Goenka Group, has seen an over three fold rise, year-on-year (yoy), in sales through the omni-channel.

A more severe wave of Covid infections and restrictions on store timings notwithstanding, the retailer has seen its gross merchandise value (GMV) rise to ₹118 crore in Q1 FY22, 210 per cent rise over the ₹38 crore it had reported in the year-ago-period, the company said in its quarterly investor presentation.

ORIPL, the e-commerce arm and 100 per cent subsidiary of Spencer’s, had reported revenue from operations to the tune of ₹7.9 core, up by over 700 per cent yoy; while the losses dipped substantially by 70 per cent to ₹1.3 crore against ₹4.3 crore in the corresponding period last year.

Also read:Spencer’s Retail reports Q1 net loss at ₹23.55 crore

According to Shashwat Goenka, Sector Head Retail and FMCG at Spencer’s Retail and RP-Sanjiv Goenka Group, the company “continues to see a strong momentum in its omni-channel business with 3.1x growth over last year.”

Omni-channel business covers foods, groceries, perishables in the ‘fresh’ categories, general merchandise, liquor and cigarettes.

The company has been ramping up its delivery infrastructure with Spencer’s offering a 3 hour service while Nature’s Basket came-up with a 90 minute delivery service targeting paid members and in select pin-codes. The latter ramped up presence in key premium markets like Navi Mumbai too.

Sequential growth

According to Goenka, , the lockdown in the second wave was far more stringent in terms of operation timings. Restrictions were also similar to last year on not allowing sale of non-essentials. This impacted “higher margin non-food sales”.

In spite of slower recovery in higher margin non-food sales, gross margins remained at last year’s Q1 levels of 20.5 per cent, while sales per square feet stood at ₹14,600, the company said in its quarterly investor presentation. “We were better prepared and the business has recovered quickly post the stringent lockdown of May & June,” he added.

Also read:Turning around the age-old Spencer’s brand

Incidentally, Spencer’s saw its standalone sales improve 7 per cent for the June quarter (vs Q1 FY21) while losses at a pre-tax level came down to ₹17 crore, a ₹30 crore improvement over the same period last year. It operates 155 Spencer’s stores pan India.

Natures’s Basket, the premium food-only retailer with 34-odd stores, too remained “EBITDA positive” quarter-on-quarter. Despite a 26 per cent drop in sales yoy to ₹80 crore (₹108 crore), earnings before interest, tax, depreciation and amortisation stood at ₹7 crore (down 22 per cent). However, gross margins saw a substantial improvement yoy, up by 189 basis points to 28.1 per cent.

“Sequentially, Nature’s Basket numbers improved except for gross margins which came down by 188 basis points,” Goenka said.

Published on August 19, 2021

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