Kishore Biyani-led Future Retail in talks to sell 10 per cent stake to foreign investor
Last week, Future Retail posted a 3.56 per cent rise in net profit at Rs 153.12 crore for the quarter ended June 30, 2018. According to a regulatory filing by Future Retail, total income during the April-June quarter stood at Rs 4,541.94 crore.
Kishore Biyani-led Future Retail could close a deal with a foreign investor in the next two months. The Group is reportedly in talks with Amazon to sell its 10 per cent stake to the latter. India doesn't allow overseas investment in multi-brand retail, but Amazon can invest in a retail company through its investment arm, the Economic Times reported today.
Amazon's investment arm is registered as a foreign portfolio investor that can acquire up to 10 per cent in an Indian entity as a single firm, the report said.
"Ultimately, it's all about how formidable we all are as players get bigger and you need alliance. We can't sell more than 10 per cent and foreign portfolio investor (FPI) is the only route available. It should take 2-3 months for any deal to fructify," the business daily quoted Biyani as saying.
Earlier in May, it was reported that Amazon did not want Future Retail to continue with its e-commerce expansion while it was looking at an exclusive tie-up.
In its Q4 FY18 investor presentation, Future Retail claimed to have 1,035 retail stores spanning 14.5 million sq.ft spread out across India in 321 cities. It had also seen over 340 million customer footfalls in FY17, a number that could only have grown further in the last fiscal.
Future Retail owns Big Bazaar, EasyDay, Foodhall, Nilgiri's and Foodworld, among others.
This could be Amazon's strategy to kill future competition as it is already facing a stiff fight from Flipkart, especially after the recent Walmart deal. India's e-commerce market is projected to grow at a compounded rate of 21 per cent over the next decade to USD 202 billion.
Last week, Future Retail posted a 3.56 per cent rise in net profit at Rs 153.12 crore for the quarter ended June 30, 2018. According to a regulatory filing by Future Retail, total income during the April-June quarter stood at Rs 4,541.94 crore. It was Rs 4,707.44 crore in the year ago period.