Bharti Group eyes Rs12,500 crore investment in farm produce retailing
18 May 2009
The Bharti Group is planning to enter retail business in agriculture and other farm-based products, with an investment of around Rs12,500 crore (around $2.5 billion).
The Mittal brothers, whose Bharti Enterprises has a tie-up with global retail giant Wal-Mart in the wholesale business, is planning a pan-India roll-out of farm produce retailing and exports over the next few years.
"We have concrete plans to invest Rs12,500 crore in the retail venture by the end of 2015," media reports quoted Rajan Bharti Mittal, vice chairman and managing director of Bharti Enterprises and director of the group's wholesale and retail business, as saying.
"Agriculture retail is going to be our next focus area for expansion," Mittal said, adding, "We have begun with fruits and vegetables. Now we will look at other areas in a big way."
The Bharti Group is waiting for the government to open the retail trade further as, under the current policy, foreign equity in only wholesale trade, technically called cash-and-carry business. The tie-up with Wal-Mart can then be expanded further.
Mittal said the main reason for the group's focus on the farm sector was that demand for consumer products has continued to swell in India. "There is no slowdown for consumer goods. Our telecom business is an example," he said.
"There is a huge potential for growth for agro-based products in India. I feel it will be a profitable venture. We are working on a new model for this business. We will unveil it soon."
In 2004, Bharti Group set up its joint venture Bharti Del Monte India with the aim of creating a global food chain and hopes to employ some 100,000 people directly or indirectly.
The company sells its products under the brand name `FieldFrsh' and has acquired around 300 acres of land in Punjab for research and development.
Mittal expects the UPA government said this was also the right time to foray into the farm products retail, a, which is free from its Left backers, to push retail sector liberalisation further.
Bharti Retail operates a chain of multiple format stores. The company's neighbourhood format stores operate under the "Easyday" brand and the compact hypermarket format under the ''Easyday market'' brand.