NEW DELHI: Kulin Lalbhai, executive director of Arvind Ltd, believes no regulatory hurdle can stop the growth of online retail in India.
“One thing you cannot stop is this (online retailing) business will become 30% (of the overall organised market) in the years to come,” Lalbhai said in an interview in New Delhi. “It is happening everywhere in the world and no regulation can change that. How and what shape it will take we can debate.”
Last month India announced amendments to its foreign direct investment (FDI) policy for e-commerce marketplaces. It bars them from selling products from their affiliates and seeks to control the extent to which large vendors can sell on such platforms.
“There will be short-term panic, but it will even out in the long term,” Lalbhai said on the latest additions to the ecommerce FDI regulations. Arvind Brands, the lifestyle and fashion retailing unit of the Ahmedabad-based conglomerate, markets global brands like US Polo, Sephora, Gap, Aeropostale, Ed Hardy and Gant in India. It also has joint ventures with Tommy Hilfiger and Calvin Klein.
In November, Arvind demerged its brand apparel business Arvind Fashions (AFL) and its engineering unit. The textile major now plans to list Arvind Lifestyle Brands as Arvind Fashions. Lalbhai said that even as his company will expand its core brick-and-mortar store network by adding 200 outlets a year, it plans to harness the digital space in a big way to boost sales through its omni-channel strategy.
He said e-commerce sales account for 15% of Arvind’s retail sales and it is growing at 60-70% every year. “If online becomes 30-35% of my business, I better be good at that. For me, Myntra and Flipkart are like malls and if I am good in a physical mall, then I’ll have to be good on Myntra and Flipkart, too,” he said. “The beauty is that products are now going to places where they have never been before. Any PIN code in India today have access to my brands.”
Lalbhai said he is bullish on the value retailing format Unlimited, which is a Rs 1,000-crore business now.
The development was reported by ETRetail.com