Hypermarkets to grow in Tier I, II cities: study

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New Delhi, Sep 23 (UNI) With organised retail in the country growing at 20 per cent per annum, about 315 hypermarkets are likely to come up in Tier I and II cities by 2011, an Assocham study today said.

''Organised retail is growing at 20 per cent annually and encouraging mall-building activities at a phenomenal rate.

This would lead to setting up of chain of hypermarkets in the country,'' it said.

The joint study by Assocham and consultancy firm KPMG said, in 2008, 212 towns have sufficient market potential for hypermarkets for break-even existence but this potential is yet to be realised.

''Given the growth in number of households, income and consumption per household in urban India, particularly in the leading 25 towns, five or more hypermarkets per city are feasible even in 2008,'' Assocham President Sajjan Jindal said.

In 2011, the number of leading towns is projected to grow to 52 as tier III towns would also gain the market potential to support five or more hypermarkets, he said.

Hypermarkets sells automobiles to needles under one roof.

However, the study found Tier IV towns to be inviable for modern retail formats not only in 2008 but also in 2011.

Mr Jindal said post-2011, organised retail would grow by 15 per cent as enough competition would have emerged by then and in about 400 towns, number of hypermarkets would have risen to 475.

The study, however, warns that despite considerable opportunities in Tier III, IV and V towns, setting up shop in these locations is likely to present retailers with challenges like availability of 25,000-30,000 sq ft of land for a single store in high street locations and recruiting sales staff and store managers.

UNI AK SR MIR KP1901

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