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<keyword id="6354955" type="PERSON" weightage="100" keywordseo="Kumar-mangalam-birla">Kumar Mangalam Birla</keyword> and his family are planning to invest Rs 500 crore in the food and grocery business owned by the <a href="http://www.businessinsider.in/Now-Aditya-Birla-Group-joins-the-Defence-equipment-manufacturing-party/articleshow/52023254.cms">Aditya Birla Group</a>, so that its authorised capital is increased to Rs 750 crore. 
 <keyword id="849288" type="COMPANY" weightage="100" keywordseo="Aditya-Birla-Retail-Limited">Aditya Birla Retail Limited</keyword> (<keyword id="148276" type="COMPANY" weightage="100" keywordseo="ABRL">ABRL</keyword>) has passed a board resolution that allows shares to be issued on a preferential basis to either Kanishtha Finance &amp; Investment or RKN Retail, promoted by <a href="http://www.businessinsider.in/Aditya-Birla-Group-would-soon-allow-employees-to-take-time-off-for-pursuing-their-entrepreneurial-ideas/articleshow/51024584.cms">Birla</a>, his family and some closely-held companies of the family. These details were revealed by the privately-held company in a filing with the Registrar of Companies. 
 
Also read: <a href="http://www.businessinsider.in/Exclusive-This-Junior-Birlaspacking-in-a-Big-Punch-meet-Ananya-Birla/articleshow/50913784.cms">Exclusive: This Junior Birla’s packing in a Big Punch, meet Ananya Birla</a> 
 
"The issuance and allotment for shares up to Rs 500 crore will be in one or more tranches within a period of twelve months," the filing said. With the additional capital, the company will be able to meet its capital expenditure needs while also handling of its debt. 
 "The board resolution was related to an enabling provision to allow the company increase the authorised capital to meet its general corporate expenses in the ordinary course of business and also to refinance its existing debt portfolio," <keyword id="271065" type="PERSON" weightage="100" keywordseo="Pranab-Barua">Pranab Barua</keyword>, business director for apparel and retail business at <keyword id="44373" type="CITY" weightage="100" keywordseo="Aditya-Birla-Group">Aditya Birla Group</keyword>, told ET. 
 
Also read: ​<a href="http://www.businessinsider.in/Now-Aditya-Birla-Group-joins-the-bad-world-of-e-commerce/articleshow/49428944.cms">Now, Aditya Birla Group joins the bad world of e-commerce!</a> 
 
ABRL is the fourth largest supermarket chain in India, featuring in the list after <a href="http://www.businessinsider.in/Kishore-Biyani-in-talks-to-raise-Rs-300-crore-for-FMCG-business/articleshow/50055279.cms">Future Group</a>, <a href="http://www.businessinsider.in/LYF-worth-could-be-1-billion-next-year/articleshow/52255160.cms">Reliance Retail </a>and <keyword id="3374400" type="COMPANY" weightage="100" keywordseo="DMart">D'Mart</keyword>. As of now, the authorised capital is Rs 390 crore, from which it is being planned to be increased to Rs 750 crore. 
 
Since its inception over 9 years ago, ABRL has seen losses of Rs 5,320 crore; however, for the year ended March 2015, the losses were reduced by 5% and brought down to Rs 571 crore. 
 
The reason behind this is said to be their strategy of focusing on <a href="http://www.businessinsider.in/One-of-Aditya-Birlas-cos-is-heading-for-a-London-Stock-Exchange-listing-soon/articleshow/49448895.cms">profitable markets</a>. 
 
<a href="http://assets.bwbx.io/images/iQDjJ.J6BX7A/v1/-1x-1.jpg">Image source</a>

Kumar Mangalam Birla and family are investing Rs 500 crore in food and grocery biz

<ul><li>Indian e-commerce giant <keyword id="6354742" type="COMPANY" weightage="20" keywordseo="Flipkart">Flipkart</keyword> has bought a 7.8% stake in Aditya Birla Fashion for ₹1,500 crore.</li><li>With the partnership, ABRL fashion brands will find their way onto the e-commerce platforms Flipkart and Myntra.</li><li>The group has raised ₹2,500 crore since April, 2020. </li></ul>Indian e-commerce giant Flipkart has bought a 7.8% stake in Aditya Birla Fashion for ₹1,500 crore. After the transaction, <keyword id="9387669" type="UNKNOWN" weightage="20" keywordseo="Aditya-Birla-Fashion-Retail">Aditya Birla Fashion Retail</keyword> Limited will have a 55.13% stake in the company. ABRL runs the Pantaloon chain of retail stores across the country. The shares of ABRL jumped by almost 5% with the news of the fundraise. The group has raised ₹2,500 crore overall since April 2020. <div type="image" title="ABRL." msid="78822832" hostid="261"></div> According to <a href="https://economictimes.indiatimes.com/tech/technology/flipkart-amazon-race-to-bag-stake-in-aditya-birla-fashion-and-retail/articleshow/78799621.cms">reports</a>, <keyword id="18635" type="CITY" weightage="20" keywordseo="Amazon">Amazon</keyword> was also in the race to buy a stake in ABRL. Announcing the partnership, Kumar Mangalam Birla, Chairman Aditya Birla Group said, “This partnership is an emphatic endorsement of the growth potential of India. It also reflects our strong conviction in the future of the apparel industry in India, which is poised to touch $100bn in the next 5 years. Fashion retail inIndia is set for robust long-term growth due to strong fundamentals of a large and growing middle class, favorable demographics, rising disposable incomes and aspiration for brands. Rapid growth of technology infrastructure will further accelerate this process.” The need to transition to e-commerce ABRL which runs the Pantaloon chain of retail stores across the country and owns brands like Allen Solly, Peter England has borne the brunt of the coronavirus pandemic. In the first quarter of the current financial year, the company had posted a loss of ₹410.36 crore as opposed to a profit of ₹21.56 crore in the same quarter the previous year. With the stores shut for a majority of the first quarter and the falling footfalls at retail outlets, analysts at Spark Capital expect the company’s annual numbers to take a hit and for profit to return only in FY22. Long road to recovery <table style="border-width: initial; border-style: none; width: 468pt; table-layout: fixed;"></colgroup><tbody><tr><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">Year </td><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">Revenue in ₹ mn </td><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">PAT in ₹ mn </td></tr><tr><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">FY20 </td><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">87,879 </td><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">-1,007 </td></tr><tr><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">FY21 Estimate </td><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">61,877 </td><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">-2,966 </td></tr><tr><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">FY22 Estimate </td><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">99,065 </td><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">353 </td></tr></tbody></table>Spark Capital report from August, 2020. And so, ABRL has been looking at ways to expand its online offerings. “E-commerce, as a route to market, is being scaled aggressively and the company is also looking to introduce new omni-channel offerings,” the company had said in May. Now, with the Flipkart partnership, ABRL fashion brands will find their way onto the e-commerce platforms Flipkart and Myntra and leverage the e-commerce giant’s reach. It also plans to expand its offerings in categories such as innerwear, athleisure, casualwear and ethnic wear which have been identified as ‘high-growth’ categories by the company. “Through this transaction with ABFRL, we will work towards making available a wide range of products for fashion-conscious consumers across different retail formats across the country. We look forward to working with ABFRL and its well established and comprehensive fashion and retail infrastructure as we address the promising opportunity of the apparel industry in India,” said Kalyan Krishnamurthy, CEO of Flipkart Group. Earlier this year, Flipkart had also bought a minority stake in the publicly listed Arvind Fashions for ₹260 crore. Arvind Fashions has 1,290 stores across India as well as a 10,000 multi-brand outlet presence. SEE ALSO: <a href="https://www.businessinsider.in/stock-market/news/cipla-zydus-cadila-jubilant-life-and-dr-reddys-shares-gain-after-fda-approves-remdesivir-for-treating-covid-19-patients/articleshow/78823033.cms">Cipla, Zydus Cadila, Jubilant Life and Dr Reddy’s shares gain after FDA approves Remdesivir for treating COVID-19 patients</a>

Flipkart beats Amazon to buy a 7.8% stake in Aditya Birla Fashion and Retail

<ul><li>The deal marks the internet giant’s entry into the food retail business in <keyword id="3658" type="COUNTRY" weightage="20" keywordseo="India">India</keyword>.</li><li>‘<keyword id="50019" type="PERSON" weightage="20" keywordseo="more">More</keyword>’ will help <keyword id="18635" type="CITY" weightage="20" keywordseo="Amazon">Amazon</keyword> set up an offline presence in India similar to its strategy in the US.</li><li>More is the fourth-largest supermarket chain in India behind Reliance Retail Ltd, <keyword id="44949" type="CITY" weightage="20" keywordseo="Future-group">Future Group</keyword> and DMart. </li></ul>Amazon.com Inc along with private equity firm Samara Capital has agreed to buy <keyword id="44373" type="CITY" weightage="20" keywordseo="Aditya-Birla-Group">Aditya Birla Group</keyword>’s grocery and food retail chain ‘More’, marking the Internet giant’s entry into the food retail business in India. The deal is valued at about ₹42 billion ($580 million), according to several media reports. Samara will own the majority stake in the entity set up to buy Aditya Birla Retail while Amazon will own the rest. <keyword id="3373923" type="PERSON" weightage="20" keywordseo="RKN-Retail">RKN Retail</keyword>, the operating entity of Aditya Birla Retail will divest its 62% stake in the business to that same entity. The deal has already received board approval from RKN, according to regulatory filings. ABRL, which launched its food and retail business in 2007, operates over 523 More-branded supermarkets and 20 hypermarkets. It is the fourth-largest supermarket chain in India behind Reliance Retail Ltd, Future Group and DMart. Offline push The deal marks Amazon’s plans to make a foray into its food retail business in India, helping it set up an offline presence similar to its strategy in the US where it has acquired grocery chain Whole Foods. This deal will also help it compete with US mass retail giant Walmart Inc. which recently bought e-commerce company Flipkart Inc. for $16 billion, and with Chinese e-commerce giant Alibaba, which is said to be considering a $5 billion (₹350 billion) investment into a joint venture with Reliance Retail, India’s largest retailer in terms of sales. Amazon has said to have set aside $500 million for its India grocery expansion plans. It has already invested $5 billion into India, its fastest growing market. Amazon along with other large retailers including Alibaba and Walmart have been adopting a hybrid business model of offline and online to compete.

Amazon rings up India’s fourth largest grocery chain ‘More’ with co-investor Samara Capital

<keyword id="44950" type="PERSON" weightage="100" keywordseo="Kishore-Biyani">Kishore Biyani</keyword>’s <keyword id="44949" type="CITY" weightage="20" keywordseo="Future-group">Future Group</keyword> has resumed talks to either buy or merge <keyword id="49861" type="COMPANY" weightage="100" keywordseo="Aditya-Birla-Retail">Aditya Birla Retail</keyword>’s ‘More’ supermarket business and cement its position further in the retail sector. 
 
The talks about the buyout or merger had begun a while ago but did not materialise. The discussions have begun again now. 
 
If the deal sees light of the day, this will be Future Group's fourth acquisition of food and grocery chain in less than five years. 
 Previously, Future Group bought Big Apple in 2012, Nilgiri's in 2014 and merged <keyword id="117289" type="COMPANY" weightage="20" keywordseo="Bharti-Retail">Bharti Retail</keyword> with itself in 2015. 
 
Aditya Birla Retail is the fourth-largest supermarket chain in India after Future Group, Reliance Retail and D'Mart with 500 stores and revenues of Rs 2,948 crore during 2014-15. 
 
Meanwhile, this acquisition or merger will also bring in more debt to Biyani. 
 
ABRL had a net loss of Rs 571 crore in FY14-15 and total debt of Rs 5,232 crore as of March 31, 2015. Future has a debt burden of Rs 4,941 crore, and high interest outgo has been impacting profits. 
 "Traditionally, brick-and-mortar retailers have not been innovative enough to extend sales from their stores to online. Online can be a 'bolt on' to the offline stores. An offline store can cover only 2-3 km radius of catchment. With online, one store can cover up to 12 km radius," K Radhakrishnan, cofounder of <keyword id="2817480" type="UNKNOWN" weightage="20" keywordseo="GrocerMax">GrocerMax</keyword>, told ET. 
 
(Image: Thinkstock)

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Kumar Mangalam Birla and family are investing Rs 500 crore in food and grocery biz

BI India Bureau

Flipkart beats Amazon to buy a 7.8% stake in Aditya Birla Fashion and Retail

Sanchita Dash

Amazon rings up India’s fourth largest grocery chain ‘More’ with co-investor Samara Capital

Rimin Dutt

Kishore Biyani resumes talks to buy or merge Aditya Birla Retail and this will be his fourth acquisition

BI India Bureau

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