Friday, January 8, 2010

Future Group Shelves plan to set up stores for electrical products

Kishore Biyani’s Future Group has shelved its plan to set up standalone stores for retailing electrical and lighting products to conserve cash, according to a company executive.

Home Solutions Retail India Ltd (HSRIL), a unit of Future Group, was planning to enter the Rs 2,000-crore lighting products market with its own stores, called ‘Bijli Ghar’. These were proposed to be set up initially as shop-in-shop in Big Bazaar stores and as standalone stores later. The group was targeting revenues of Rs 100 crore in the first year of operations.

“Instead of running separate stores for lighting products, we thought of launching products in our existing stores,” the executive said.

The company has instead launched compact fluorescent lamps (CFLs) and electrical accessories under the ‘LSL’ brand, the executive added.

HSRIL had set up two joint ventures with lighting products manufacturer Asian Electronics — Asian Retail Lighting and Home Lighting India Ltd — to manufacture lighting products for the retail sector and for home lighting.

On Wednesday, Asian Electronics said it was merging Home Lighting with Asian Retail Lighting and disposing its entire investments in Home Lighting.

“Both the companies were operating from the same location and doing similar work. We thought of merging the companies to bring operational synergies and cost efficiencies,” R D Goradia, senior vice-president, Asian Electronics, told Business Standard.

Even Future Group has been streamlining its operations. Late last year, the group had said it was consolidating its non-retail investments to retain Pantaloon as a profitable retail company. On January 1, Pantaloon, the flagship company of Future Group, announced that it had transferred the value retail business of the company to Future Value Retail.


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