Bangalore: Chenniappan Gopalakrishnan, a former director of Nilgiri Dairy Farm and part of the family that started Nilgiris, the oldest retail chain in south India, is making a comeback to the food retail business with N Store Food Retail Pvt. Ltd.
Gopalakrishnan had exited Nilgiris after UK-based private equity fund Actis bought a 74% stake in the company for Rs300 crore in 2006. The remaining 24% is still owned by other members of Gopalakrishnan’s family. After completing a mandatory one year non-compete clause in October, he has now launched the new chain.
The company currently has two formats: N Store supermarkets and Kaapi Kadai cafés.
The new company, run by Gopalakrishnan and his 21-year-old daughter Gauri, currently has two supermarkets and three cafés.
Gopalakrishnan plans to have 50 supermarkets and 50-70 cafes by year-end, spread across south India.
“I would like to float seven N Stores and 10 Kaapi Kadais by March. Each N Store would need an investment of about Rs60 lakh, while a café would take about Rs10-15 lakh. We plan to house the cafés in our outlets, though some of them would be stand-alone as well,” he said.
N Store also has an outlet in Washington, DC, after it brought a 50% stake in an existing store and rebranded it. Gopalakrishnan said he is in negotiations with two more stores for franchising the N Store brand, one each in Washington and Dallas.
At present, his expansion plans have been funded through the capital he received from Actis for his stake in Nilgiris, though he declined to specify the amount he received as his share.
However, he said the company is in talks with venture capital as well private equity equity firms for investment but refused to disclose details. “We are keen on partnering with people who have experience in food retailing,” he added.
Kaapi Kadai cafés will have a presence in shopping malls, while N Store would not. The company, which has a green logo, is still called ‘Nilgiris’ by the locals. Gopalakrishnan, however, says the ‘N’ in his new company’s name has nothing to do with Nilgiris.
“‘N store’ in Tamil means ‘my store’. We decided on this name as we wanted to give our customers a feeling of ownership,” he said. The chain would focus on catering to the daily needs of customers, he said.
The company also has a bakery and a packaging unit at Krishnagiri, 100km from Bangalore. Products from the bakery would be sold not only through the company’s outlets but by other local cafés also.