RPG group to plans Rs2,500 crore expansion for Spencer's Retail

Mumbai: RPG group would invest Rs2,500 crore in retail expansion across the country during the next four years. The group will invest Rs1,000 croe in the first phase of expansion of its retail business Spencer's and another Rs1,500 crore in the second phase. "The company plans to invest around Rs1,000 crore in the first phase of expansion of its retail venture, Spencer's. The first phase will end in 2009. For the second phase, we have lined up an additional investment of Rs1,500 crore for further expansion till 2011," Sanjiv Goenka, vice chairman, RPG Enterprises, said.

He, however, ruled out any tie-up with a foreign retail chain. Goenka said the expansion plan involved setting up more than 4,000 stores by 2011 spread across five retail formats - hypermarkets, supermarkets, daily stores, express stores, and fruit and vegetable stores.

Spencer's has eight hypermarkets in the country. Goenka said over the next three months the company would open one store every day and two stores every day over the next six to 12 months. The stores will range between 2,500 square feet for the ''neighbourhood express stores'' and over 60,000 square feet for the hypermarkets.

"By 2011 we are looking at a total retail space of 15 million square feet for our company," he said.

The funds would come from both internal accruals and the market. He said the company would raise funds for the planned expansion through a mix of resources, which includes private placements and internal accruals.

He also did not rule out the possibility of a public issue and a fresh listing of its retail venture. The company does not plan to purchase any space for its retail ventures. "All our stores will be on leased space," Goenka said.

Organised retail is in the country is expected to see big growth over the next few years.