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India Food & Drink Report Q1Published by: Business Monitor International Published: Feb. 1, 2007 - 69 Pages Table of Contents
AbstractAll eyes are once again on the Indian mass grocery retail (MGR) sector, thanks to the news that US behemoth Wal-Mar has finally found a means of circumventing restrictive foreign direct investment (FDI) legislation and securing market entry in partnership with local telecoms specialist Bharti Group. In the newly-published Q107 India Food & Drink Report, BMI examines the wider implications of this news with regards to its impact on our growth forecasts, the business strategies of local retailers and the entry plans of rival multinationals.Since the publication of our Q406 report the tide has turned and instead of the preparatory expansion plans of existing local operators governing the Retail Company Developments section, the efforts of multinationals to secure favourable joint venture partners have taken over. In the past two months alone, France's Auchan and Carrefour have been linked with subsidiaries of the Wadia Group, while leading Indian conglomerate the Tata Group has been linked with both UK-based Tesco - the firm that missed out on the Bharti venture - and Australia's Woolworths. Confirmation of Wal-Mart's imminent entry - its first stores are expected by early 2008 - in addition to the increased likelihood of more local/multinational partnerships being established now that a precedent has been set, prompted BMI to raise its MGR sales growth forecast this quarter. Sales through all MGR formats are set to increase by 223% to US$4.49bn in 2011, with hypermarkets and discount stores - the formats most likely to receive multinational investment - showing the strongest growth with forecasts of 260% and 229.2% respectively. Growth in the supermarket format, which will continue to benefit from the defensive expansion plans of existing operators, has also been forecast upwards to 132.9% over the five-year period. Another major change this quarter has been India's rise up BMI's Retail Business Environment Rankings table. India was in fourth place this time last year but now sits joint first, thanks to the continued relaxation of FDI laws, which have led to an improvement in the country's Barriers To Entry score - one of the indicators that was reducing India's overall attractiveness to retail investors. Should the benefits of the country's ongoing economic growth spill over into rural communities and begin to boost rural spending power, the accordant increase in per-capita food consumption levels would most likely see India pull away at the top of the rankings table. With business activity levels in India's MGR sector at an all-time high, 2007 looks set to be a very dynamic and exciting year for the industry. Get Full Details About This Report >> |
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