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Retail stocks gain as much as 6 pc on FDI norms relaxation

Press Trust of India  |  New Delhi 

stocks today rose by as much as 6 per cent following the government's decision to relax the norms in single-brand

of surged 6.66 per cent, climbed 5.11 per cent, (India) rose by 4.93 per cent, gained 3.99 per cent and V-Mart went up by 3.68 per cent on

Among others, Future Consumer rose by 2.25 per cent, (2.01 per cent) and (1.15 per cent).

"The has undertaken another step of relaxing the norms for investment in single brand retail, construction and aviation sector. With this the has approved 100 per cent in single via direct/ automatic route, thus opening the economic corridors for global single brand retailers like IKEA, NIKE, etc and removing hurdles for investment in

"These developments will attract foreign and create employment opportunities in It will also encourage into supply chains thereby reviving the manufacturing sector," said Arun Thukral, MD and CEO, Axis Securities.

Foreign players in single trade will now be able to set up own shops in without approval.

This follows a Cabinet decision to allow 100 per cent FDI in single under automatic route, while also easing local sourcing norms.

Till date, 49 per cent FDI was allowed under automatic route, while beyond that government's approval was required.

Industry players welcomed the development saying it would help attract more foreign in the sector and boost the economy and generate employment.

"The liberalisation in single brand sector is a progressive move in the direction of 'ease of doing business' in India. Allowing 100 per cent FDI under automatic route should stimulate foreign investments in the sector. Further, allowing incremental sourcing undertaken by overseas group companies to be counted towards the 30 per cent sourcing commitment for the initial five years will provide the single brand companies the flexibility and time to align their retail and sourcing business," said Goldie Dhama, Partner - Regulatory, PwC India.

(This story has not been edited by Business Standard staff and is auto-generated from a syndicated feed.)

First Published: Wed, January 10 2018. 18:40 IST