Aditya Birla Retail loss widens to Rs650 crore in FY16

Revenue grew 21.3% to Rs3,509.37 crore in fiscal 2016 from Rs2,893.41 crore a year earlier


Debt also increased to Rs5,936.21 crore in 2015-16 from Rs5,286.36 crore a year ago, as per Aditya Birla Retail’s filing. Photo: Pradeep Gaur/Mint
Debt also increased to Rs5,936.21 crore in 2015-16 from Rs5,286.36 crore a year ago, as per Aditya Birla Retail’s filing. Photo: Pradeep Gaur/Mint

Aditya Birla Retail Ltd (ABRL) which operates supermarkets and hyper markets under the More brand continued to post losses in 2015-16, even as it reported strong revenue growth.

Loss widened to Rs649.42 crore in fiscal 2016 from Rs571.14 crore in the previous fiscal, according to the company’s filings with the Registrar of Companies (RoC).

Revenue grew 21.3% to Rs3,509.37 crore from Rs2,893.41 crore a year ago.

Some of this growth in loss and revenue would be due to the acquisition of five loss-making Total Hypermarkets stores from Jubilant Industries Ltd and its material subsidiary Jubilant Agri and Consumer Products Ltd in May, said Santosh Verma, director, investment banking at IDFC Bank.

Debt also increased to Rs5,936.21 crore in 2015-16 from Rs5,286.36 crore a year ago, as per the company filing.

However, since 2009, ABRL has focused on raising efficiency and profitability, closing more stores than it opened. In the last fiscal year, it added only five supermarkets, increasing store count to 487. Even after the acquisition of the five Total Hypermarkets stores, its overall number of hypermarket stores (of over 30,000 sq ft) stood at 19 compared to 16 hypermarkets a year ago. At its peak in 2008, ABRL had close to 800 stores.

Meanwhile, the organised retail sector, driven by Kishore Biyani’s Future Group in the food and groceries space, has been consolidating. In the past 3-4 years, Biyani has bought retail chains such as Big Apple, EasyDay, Nilgiris, retail business of Heritage Foods Ltd and Sangam Direct, a retail chain earlier known as Sabka Bazaar, from Wadhawan Retail Ventures Pvt. Ltd.

Profitable retailers such as D-Mart are on an expansion mode. In September, Avenue Supermarts Ltd, owner of D-Mart, announced plans to raise Rs1,870 crore to pare debt and open new stores.

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