Mumbai: Reliance Retail expects sales to grow 20% this fiscal year at stores open at least a year on the back of steady consumer spending, ruling out any slowdown due to high inflation and rising interest rates.
“We are confident of achieving 20% same-store sales growth across our formats in the current fiscal, despite the current market conditions,” Bijou Kurien, president and chief executive officer for its lifestyle segment, told reporters on the sidelines of an industry conference.
There had been no impact on spending at its value retail and electronics segments, he added.
Reliance Retail, a unit of Reliance Industries, currently operates around 1,000 stores in the country across value retail, or food and groceries segment, and specialty formats.
Earlier this month, the Reserve Bank of India raised interest rates for the 12th time in 18 months, while headline inflation in August rose to 9.78%, the highest in a year, raising concerns about slowing growth in Asia’s third-largest economy.
Organised retail makes up only 6% of India’s $450 billion retail sector, but is expanding at 20% a year. Cash-strapped Indian retailers have been on the lookout for tie-ups with global players ahead of the government allowing foreign investment in multi-brand retail.
Reliance, controlled by billionaire Mukesh Ambani, the world’s ninth richest man, said earlier this year it plans to invest aggressively in the retail sector as it looks to diversify beyond its core energy business.
Earlier this month, Reliance opened its first wholesale cash-and-carry format store at Ahmedabad, and now plans to accelerate expansion in that format.
“We have plans to open a chain of stores across cash-and-carry across India. There is already a plan in place in terms of which towns we want to go to and we are working on that,” Kurien said.
Reliance recently hired two former Wal-Mart executives to run operations at the retail subsidiary, which is currently loss-making.