ABRL Aims big on PVT labels, plans consumer durables foray

Business Standard
27 May 2010

Aditya Birla Retail today said it will increase focus on its private labels business and is looking to introduce its own branded consumer durables and electronics products by 2012.

The company, which is the retail arm of Aditya Birla Group, said it aims to increase the share of private labels in its total sales to 30 per cent within 2-3 years from around 20 per cent currently.

"Our strategy is to focus more on private labels as they give more margins and also increase our own brand profile. We aim to increase the share of private labels in our total sales to 30 per cent in the next 2-3 years from the existing 20 per cent," Aditya Birla Retail Ltd (ABRL) Chief Executive Officer Thomas Varghese told PTI.

Private labels are products manufactured by a company under its own brand and are generally positioned as lower cost a;lternatives to national or international brands.

Varghese said ABRL is exploring the consumer durables and electronics segments for launching its own private labels.

"However, it will take some time... Maybe a year-and-a-half... Maybe by early 2012, before we introduce our own range of consumer durables and electronic items. We will launch them once we have at least 15-16 of our large format More Hypermarts," he said.

Varghese added that the company will look at all categories of consumer durables, including televisions, coolers and refrigerators.

"We will outsource the manufacturing to some top quality manufacturers either in India or abroad. We want to maintain the quality of a Aditya Birla-branded products," he added. ABRL currently sells a range of private labels catering to various segments, including FMCG, apparels and footwear. Among its major in-house brands are More (staples), Blue Earth (apparels), True (footwear), Feasters (food based items), Kitchen's Promise (ready-to-eat) and Enriche (soaps and conditioners).

ABRL, which had a turnover of Rs 1,460 crore in 2009-10, today opened its first More Hypermarket in the Delhi NCR region. It currently has 540 More supermarkets and seven large format More Hypermarts in 167 cities and towns across India.

The company had earlier planned to invest Rs 200 crore this fiscal to open another 100-odd supermarkets and 8-10 more hypermarts by March, 2011.