Kishore Biyani, the group chief executive of Future Group, says he will focus on profitable growth, free cashflows and EBITDA to debt not more than three times in his "second innings as entrepreneur", after he sold majority stake in Pantaloons format to cut debt.
Biyani's flagship Pantaloon Retail was panned by analysts for negative cashflows and high interest outgo in the past.
"Every entrepreneuer has two innings and this is my second innings. I will play my second innings with certain principles which were not there in the first, I will focus on only profitable growth, free cashflows and EBITDA to debt of not more than three times," Biyani said at an event here. On the business targets, Biyani said Future group will have a turnover of Rs 14,000 crore from its three verticals--hypermarkets, fashion and food and FMCG by next financial year. The hypermarkets vertical is expected to post turnover of Rs 9000 crore, fashion vertical to post a turnover of Rs 4000 crore and food and FMCG vertical to post a turnover of Rs 1000 crore by FY 2013, he said. Currently, the group has a topline of Rs 14,000 crore including that of its fashion format Pantaloons, whose majority stake has been sold to Aditya Birla Nuvo, a unit of Aditya Birla Group. The expected turnover is excluding the topline of Pantaloons, a group executive clarified. The group has a total retail space of 16.5 million square feet which is expected to touch 18.5 million sq ft by next financial year. Future Lifestyle Fashion, the newly demerged company of Pantaloon Retail will be a Rs5000 crore business in the next two years, Biyani said.
Future Lifestyle Fashion was created after demerging fashion business of Pantaloon Retail and fashion brands held by Future Ventures, the venture arm of the group. The company has 4 million sq ft of space and two dozen brands. "The fashion business has capacity of delivering EBITDA margin of 12 to 13 per cent and by merging fashion business of Pantaloon and Future Ventures, it can add 2 to 3 per cent additional EBITDA margins," he said.