Subhiksha to roll out 80 stores in Andhra

Riding on the success of its sharp discount offers, Chennai-based Subhiksha retail chain is planning to launch 80 stores across Andhra Pradesh in the next four months at an investment of Rs 40 crore.

Of this target, it has already set up 53 stores as part of a soft launch in Hyderabad besides important cities in coastal Andhra in the past few months.

Addressing a press conference in connection with its Andhra plans, R Subramanian, managing director, Subhiksha, said the company was offering up to 10 per cent discount on products across all the four verticals, namely telecom, supermarket, fruits and vegetables and pharmacy.

According to him, the company has been pursuing a strategy for faster growth aiming at large turnover on lower margins as compared to the competition.

"Our business model appears mainly targeting the middle income groups but our 10-year experience in Tamil Nadu gives a different picture," Subramanian said, adding that sharp discounts on purchases are equally attracting upper middle classes as well.

He said the major benefit coming from bulk purchases by the company was being directly transferred to the customers through discounting instead of overspending on shop comforts.

While ruling out the possibility of entering into any kind of arrangement with Reliance retail business, Subramanian, however, said the proposed IPO is expected to happen in the next one year while it would become a 1,000-store strong company in the meantime.

Subhiksha's stores will have telecom divisions, which will offer products and services to the mobile customers, he said.