Bharti, Wal-Mart form JV; roll out to be decided in Jan'07

New Delhi, Nov 27 (UNI) Bharti Enterprises today announced a tie-up with world's largest retailer Wal-Mart Stores Inc, US, to jointly explore business opportunities in the growing Indian retail space.

With the current government regulations permitting FDI in cash-and-carry and logistics but not in the front-end retail, the two companies have signed an MoU for the former business.

''This partnership with equal stakes will operate in areas where the government allows foreign investment in retail like cash-and-carry and logistics,'' Bharti Enterprise Chairman Sunil Mittal told reporters on the sidelines of an economic summit in the national capital.

''We are going to be a big player in the market... We will roll out several hundred stores across the country in the coming months,'' Mr Mittal said, adding that the new JV was aimed at giving customers the ''lowest prices'' possible.

He said the retail shops, owned by Bharti Enterprises under the Wal-Mart franchise, would probably carry items with both brand names.

Mr Mittal gave no financial details but media reports said the Bharti-Wal-Mart venture would initially invest 100 million dollars, which would go up to 1.46 billion dollars.

The foray includes all major formats like hypermarkets, supermarkets and grocery stores with detailed roll-out plans to be finalised by January 2007.

This announcement came after British retail giant Tesco Plc's talks with Bharti Enterprises collapsed.

Meanwhile, Mr Mukesh Ambani, Chairman Reliance Retail Ventures, who launched a multi-billion-dollar retail rollout in Hyderabad with plans to create a Wal-Mart style retail venture in India, told reporters that new entrants ''will make our retail sector stronger.'' Wal-Mart Stores Inc operates Wal-Mart discount stores, supercenters, neighbourhood markets and Sam's Club locations in the United States. It has established a liaison office in India and has been sourcing clothing and textiles from India worth 1.5 billion dollars.

Organised retailing counts for 3 per cent of the total retail market, compared to China's 20 per cent and Thailand's 40 per cent, at of now.

But with the entry of large Indian firms including Bharti, Reliance Industries, the Tata group and the Aditya Birla Group, the share is set to rise to 15-18 per cent by 2011-12, according to industry experts.

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