Pantaloon acquires 22 million sqft retail space, to spend more on fashion

Kishore Biyani-led Pantaloon Retail India has booked a total of 22-million sq ft of retail space and plans to make 3-million sqft operational every year over the next 3-4 years.

"We have signed up to 20-22-million sqft of retail space (with developers at rentals lower than industry average). As a group, we have a target of around 3-million sqft of addition each year for the next 3-4 years...," Future Group Founder and CEO Kishore Biyani told analysts in a conference call.

Pantaloon Retail India (PRIL) operates over 260 retail outlets and malls spread over 13-million sqft across India. The Future Group firm will also increase spending on its fashion and lifestyle ventures, which would contribute to 35 per cent of its total revenues.

It has a capital expenditure plan of Rs700-crore this fiscal and plans to open 14 Pantaloon stores and six Central malls across eight key consumption centres. Pantaloon Retail is pursuing an approach of "controlled aggression" this year, as the economic meltdown slowed the company's pace of expansion in FY'09.

"The year which has gone by was a challenging one. I think what we learnt is we cannot always grow by aggressive expansion. Things are coming back to normal but we have to move further from here, although we have not expanded as aggressively," Kishore Biyani said.

"So, while we are looking at controlled aggression, I would say we are still realistically optimistic about the business because the market size is huge," he added. India's largest listed supermarket operator expects footfalls to move up to close to 230-million in FY'10 against 185-million registered in the year ending June 2009.

Pantaloon expects to improve its financials as a result of several measures to cut costs and improve efficiencies, including a voluntary pay cut for senior management. It aims to cash in on the growth of India's organised retail market, which may expand to $75-billion by 2015 from $20-billion at present.