The promoters of Vishal Retail, country’s second largest public-listed retailer, is learnt to be engaged in evaluating several options to raise capital to sustain company’s current operations and planned expansion. Vishal Retail CMD Ram Chandra Agarwal said: “We are in talks with many players and looking at various options for the retail business. But it is too early to comment on specifics.”
However, one possibility could be a strategic alliance with another retailer or a business house with interests in retail.
Earlier in October, the company made a filing to National Stock Exchange stating that the company had obtained shareholder’s approval to raise Rs 2.5 billion through further issue of securities. The company raised Rs 1.1 billion in its initial share sale in July 2007. Its shares were listed at Rs 472.50, up 75 per cent against its issue price of Rs 270. The retailer’s shares fell to a life-time low of Rs 55.60 on November 21 from a peak of Rs 1,001 on January 15, 2008 on Bombay Stock Exchange. The company has been in talks with several private equity players since the beginning of the year to raise fresh capital, though with little success.
The promoter group has a 63.93 per cent stake in Vishal Retail, which currently operates 178 stores — including hypermarkets and convenience stores — across the country. With presence in around 100 cities, the company is a value retailer catering primarily to consumers in tier-II and III cities. The company’s stores sell ready-made clothes, household merchandise, footwear, toys, watches, grocery items, sports items, crockery, gift and novelties.
— IndiaRetailing Bureau