Essar Hypermart to sell steel online, up its marts in India

In sync with plans to deepen its penetration in retail space, conglomerate Essar Group's retail arm Essar Hypermart today said it would sell steel online by current fiscal-end, which will contribute 10-15 per cent of its total sales.

Besides, the company may hive off its retail operations after the implementation of Goods and Services Tax (GST).

"We will introduce our online sales module for selling steel products primarily to small and medium enterprises (SMEs) by the end of current fiscal and business through online is expected to contribute 10 to 15 per cent of our total sales," Essar Hypermart CEO Girish Rao told reporters here today.

Essar Hypermart is eyeing sales of Rs 4,200 crore through its retail network by end of current fiscal, against sales of Rs 3,600 crore achieved in last fiscal.

"Under the online sales, we will be booking steel orders from our customers and we will also introduce payment gateway enabling customers to make payment online for their convenience," he said.

The company is currently running online sales operations on trial basis in Gujarat and Maharashtra.

Aiming to supply steel at customers' doorstep throughout the country, Essar Hypermart, with a customer base of 10,000, has plans to start direct delivery system through inducting a fleet of vehicles.

"We plan to have a fleet of 150 vehicles which will supply steel to customers at their doorstep. This direct delivery system is currently running in Rajasthan and Gujarat," he said.

When asked about having separate operations, Rao said the retail operations can be hived off once the GST comes into operations. "We may hive off our retail operations only after GST implementation, as it (GST) will resolve several taxation issues," he said.

As part of its plans to expand its network throughout the country, Essar Hypermart has decided to increase the strength of Hypermart and Expressmarts to 126 and 650, respectively by opening more outlets in several parts of the country, including Punjab, Jammu and Kashmir etc.

Currently, the company has 100 hypermarts and 410 expressmarts. Hypertmarts are operated by company itself while Expressmarts are run by franchise.

Essar Hypermart plans to sell 1.5 million tonne of steel by end of current fiscal, against 1.1 million tonne sold in last fiscal. The sales from Essar Hypermart has 25 per cent share in Essar Steel's revenue.