Mumbai: Retailer Shopper’s Stop, part of the K. Raheja group, is planning to raise about Rs300 crore by selling shares to institutional investors in 6-9 months, a top official said on Wednesday.
The firm already has shareholders’ approval to issue 4 million shares to institutional investors but the exact number of shares to be issued may change, Vice Chairman B.S. Nagesh told reporters.
The funds would be used for expansion of the group’s Shopper’s Stop and Hypercity stores. Hypercity is the multibrand retailing format floated by the founders of Shopper’s Stop.
“Cash flows we have generated has been good and I think the amount will be around 300 crores,” Nagesh said on the sidelines of a conference by the India Shopping Forum.
Enam Securities, which was working with Shoppers on its rights issue, will probably help arrange the QIP, Nagesh added.
The firm had planned to raise between Rs300-500 crore via the rights issue, but it subsequently shelved the plan saying that it didn’t require funds at that time.
The Shopper’s Stop board had approved increasing its stake in unlisted Hypercity Retail (India) Ltd to 51% by acquiring an additional 32% stake from founders by June 30.
The firm would be adding 8-12 stores under the Shopper’s Stop banner at an investment of Rs100-125 crore in FY 11, Govind Shrikhande, Chief Executive said.
The group, which will also add 3-5 hypercity stores, will hire 1,500 to 1,800 employees in FY11 as a result of the addition of stores, Nagesh said.
“About 100 employees per store would be added. It could be 1,500-1,800 in the best case scenario,” Nagesh said.
Shares of the firm provisionally ended down 0.79% at Rs389.95, in a weak Mumbai market.