Future Retail
About
Future Retail Limited (“FRL”/”Company”), is India’s pioneer in homegrown modern organised retail and meets the aspirational needs of urban and rural consumers across the country through its various formats viz. large formats (Big Bazaar, fbb (Fashion @ Big Bazaar), Hypercity, Foodhall) and Small Store formats (easyday, Heritage, Nilgiris). During the year under review, the Company has expanded its small store formats at various locations. The expansion and increase of access points in under served areas has fueled creation of grass root employment and contributed significantly to social inclusion.
The business through its fashion, food, and home segments works with value chain members who have a large role to play in the success of the business as well as the ecosystems it operates in.
Big Bazaar
For the financial year 2018-19. For this financial year ended March 2019, Company has posted income from operations of ` 20,165 crores and net profit of ` 733 crores, resulting in an earnings per share (EPS) of ` 14.58. By the end of the financial year, the Company operated 1,511 stores and attracted 351 million customer visits.
Fashion on big bazaar (Fbb)
In 428 cities from neighbourhoods to a national retail network
With our presence in 428 cities and towns, FRL is now set to replicate this approach at national level.
With 292 large format stores in almost every state of the country, Big Bazaar is the country’s prominent national retailer. The brand is counted among the most trusted brands in the services sector.
The small store network is built on a robust technology platform that makes it more convenient for customers and more scalable for the organisation. During this year, company introduced the easyday Club mobile app for ordering products, scheduling home deliveries and store pick-ups, along with many other features for our member customers. This has been introduced in over 140 stores in Delhi NCR and has resulted in significant increase in spends and frequency of our member customers. During the forthcoming year, company will be extending it in a phased manner across different cities.
India’s national retailer went a step ahead with operating 292 stores in 144 cities and towns in 28 states across the country. By the end of the financial year, Big Bazaar stores across the country had attracted 244 million footfalls and once again winning the plaudit of the most trusted retail brand in the country. New stores came up in far-flung cities - from Jalpaiguri in West Bengal and Dibrugarh in the Assam to one’s within the heart of the country - Ramgarh in Jharkhand or Korba in Chattisgarh. New stores were also added in cities like Pune (seventh store), Bhubaneswar (sixth store) and Nagpur (sixth store).
Innovative customer service initiatives, next generation layouts and store design, and a wider assortment of fresh food and services mark every Big Bazaar GenNxt stores in key urban centers. GenNxt store was launched in Hyderabad. New digital initiatives included a large collection of video recipes on YouTube channel, CookAlong and SmartSearch on Google that provides exclusive offers and prices for products.
India Fashion Fbb's
Over the years, fbb has emerged as a popular fashion destination for young consumers and families. Every Big Bazaar store features a large fbb section that offers garments across every category. Almost every garment sold at fbb is a Future Group owned brand like Knighthood, DJ&C, Bare, Buffalo in menswear, shyla and Srishti in womenswear, Pink & Blue in kidswear, or exclusive licensee brands like Lee Cooper Original or Converse. Popular music icon, Diljit Dosanjh joined Bollywood Katrina Kaif and Varun Dhawan as celebrity endorsees for fbb. The brand’s association with fbb Miss India pageant now helps the brand connect with customers in every state and small cities and towns across India. A number of new initiatives were taken to
Neighbourhood Store
The Company’s neighbourhood store network increased from 666 stores at the end of March 2018 to 1,007 stores by the end of March 2019. Now spread across 335 cities and towns in 23 states across the country, the small stores network attracted over 94 million customer footfalls. In northern India, easyday is the primary brand while in South India, Heritage Fresh is the primary brand for the country’s neighborhood store network. During the year, the Company acquired and integrated the Foodworld chain into this small store network
The small store network is being developed as a membership platform. Every store is mandated to have around 3,500 member-customers who can avail a range of benefits including home delivery and a flat 10% discount across most products. In February 2019, the Company introduced an improved and updated version of its app-based ordering platform for customers in around 140 easyday stores in the Delhi National Capital Region. The response from customers have been overwhelming and has led to a significant increase in total relationship value and frequency of orders from member customers
During the forthcoming year, the Company will be extending this platform to select cities and towns across the country. The appbased platform is already integrated with the FuturePay mobile wallet, allowing a frictionless payment experience for customers. Customers can schedule a time and date of home delivery or pick it up from the store at a scheduled time. During the year, the Company hopes to also launch a chat-based ordering platform on its mobile app.
The small store network will be the prime driver for growth and consumer engagement in the years ahead. Built on a strong digital platform and being close to customers, the stores operate with the lowest fulfillment cost and lowest customer acquisition cost, compared to any digital-led food and grocery business.
City Overview
Other 428 places
Strategic focus areas (SFAs) and plan of implementation under each SFA
E -commerce major Amazon has partnered with India’s leading retailer, Future Retail Ltd (FRL), as they seek to expand their reach by leveraging each other’s networks
Amazon had acquired a 49% stake in Future Coupons, which holds about 7.3% in Future Retail through convertible warrants, the company that holds Biyani’s BigBazaar retail chain.
“The company has successfully priced a USD 500 million Fixed Rate Senior Secured 144A/Reg S Bond for a 5-year (non-call 3-year) tenor at 5.600 per cent,” the company said in a regulatory fiiing.
As per the company, the bond transaction also marks the first international bond deal from the retail and consumer sector space in India.
The notes will be listed on the Singapore Exchange Securities Trading Limited (SGX- ST).
“The transaction witnessed 37 per cent participation from Asia, 42 per cent from the US and 21 per cent from EMEA with 84 per cent investment from long haul funds, 8 per cent from private banks, 5 per cent from insurance/pension funds and 3 per cent from banks and others,” the filing said.
It further added that there has been strong demand from most of the blue chip names amongst the largest funds across the globe.
Deutsche Bank, Standard Chartered Bank, Barclays, J P Morgan and UBS acted as Joint Global Coordinators and Joint Bookrunners on the issue. SBICAP, Credit Suisse, Emirates NBD Capital and Rabobank acted as Joint Bookrunners, while A K Capital acted as Financial Advisor to the Issuer. (PTI)
About
Future Retail Limited (“FRL”/”Company”), is India’s pioneer in homegrown modern organised retail and meets the aspirational needs of urban and rural consumers across the country through its various formats viz. large formats (Big Bazaar, fbb (Fashion @ Big Bazaar), Hypercity, Foodhall) and Small Store formats (easyday, Heritage, Nilgiris). During the year under review, the Company has expanded its small store formats at various locations. The expansion and increase of access points in under served areas has fueled creation of grass root employment and contributed significantly to social inclusion.
The business through its fashion, food, and home segments works with value chain members who have a large role to play in the success of the business as well as the ecosystems it operates in.
Big Bazaar
For the financial year 2018-19. For this financial year ended March 2019, Company has posted income from operations of ` 20,165 crores and net profit of ` 733 crores, resulting in an earnings per share (EPS) of ` 14.58. By the end of the financial year, the Company operated 1,511 stores and attracted 351 million customer visits.
Fashion on big bazaar (Fbb)
In 428 cities from neighbourhoods to a national retail network
With our presence in 428 cities and towns, FRL is now set to replicate this approach at national level.
With 292 large format stores in almost every state of the country, Big Bazaar is the country’s prominent national retailer. The brand is counted among the most trusted brands in the services sector.
The small store network is built on a robust technology platform that makes it more convenient for customers and more scalable for the organisation. During this year, company introduced the easyday Club mobile app for ordering products, scheduling home deliveries and store pick-ups, along with many other features for our member customers. This has been introduced in over 140 stores in Delhi NCR and has resulted in significant increase in spends and frequency of our member customers. During the forthcoming year, company will be extending it in a phased manner across different cities.
India’s national retailer went a step ahead with operating 292 stores in 144 cities and towns in 28 states across the country. By the end of the financial year, Big Bazaar stores across the country had attracted 244 million footfalls and once again winning the plaudit of the most trusted retail brand in the country. New stores came up in far-flung cities - from Jalpaiguri in West Bengal and Dibrugarh in the Assam to one’s within the heart of the country - Ramgarh in Jharkhand or Korba in Chattisgarh. New stores were also added in cities like Pune (seventh store), Bhubaneswar (sixth store) and Nagpur (sixth store).
Innovative customer service initiatives, next generation layouts and store design, and a wider assortment of fresh food and services mark every Big Bazaar GenNxt stores in key urban centers. GenNxt store was launched in Hyderabad. New digital initiatives included a large collection of video recipes on YouTube channel, CookAlong and SmartSearch on Google that provides exclusive offers and prices for products.
India Fashion Fbb's
Over the years, fbb has emerged as a popular fashion destination for young consumers and families. Every Big Bazaar store features a large fbb section that offers garments across every category. Almost every garment sold at fbb is a Future Group owned brand like Knighthood, DJ&C, Bare, Buffalo in menswear, shyla and Srishti in womenswear, Pink & Blue in kidswear, or exclusive licensee brands like Lee Cooper Original or Converse. Popular music icon, Diljit Dosanjh joined Bollywood Katrina Kaif and Varun Dhawan as celebrity endorsees for fbb. The brand’s association with fbb Miss India pageant now helps the brand connect with customers in every state and small cities and towns across India. A number of new initiatives were taken to
Neighbourhood Store
The Company’s neighbourhood store network increased from 666 stores at the end of March 2018 to 1,007 stores by the end of March 2019. Now spread across 335 cities and towns in 23 states across the country, the small stores network attracted over 94 million customer footfalls. In northern India, easyday is the primary brand while in South India, Heritage Fresh is the primary brand for the country’s neighborhood store network. During the year, the Company acquired and integrated the Foodworld chain into this small store network
The small store network is being developed as a membership platform. Every store is mandated to have around 3,500 member-customers who can avail a range of benefits including home delivery and a flat 10% discount across most products. In February 2019, the Company introduced an improved and updated version of its app-based ordering platform for customers in around 140 easyday stores in the Delhi National Capital Region. The response from customers have been overwhelming and has led to a significant increase in total relationship value and frequency of orders from member customers
During the forthcoming year, the Company will be extending this platform to select cities and towns across the country. The appbased platform is already integrated with the FuturePay mobile wallet, allowing a frictionless payment experience for customers. Customers can schedule a time and date of home delivery or pick it up from the store at a scheduled time. During the year, the Company hopes to also launch a chat-based ordering platform on its mobile app.
The small store network will be the prime driver for growth and consumer engagement in the years ahead. Built on a strong digital platform and being close to customers, the stores operate with the lowest fulfillment cost and lowest customer acquisition cost, compared to any digital-led food and grocery business.
City Overview
Other 428 places
Strategic focus areas (SFAs) and plan of implementation under each SFA
Company Financial Strength
Total number of employees: 45,949
Debt : 1,329.23 crore
Equity : 0.62 crore
Net worth : 3,976.15 crore
Founder
Share Holding Pattern
Company Journies
Dec 2018
In December, the family office of Biyani's had raised Rs 3,000 crore from three investors, including AION Capital, Future group's insurance joint venture partner Generali and its shoe-brand JV partner Sketchers in a bid to strengthen its position and lower debt.
The group has also in the past few years shut down sportswear arm Planet Sports, merged electronics retail chain Ezone with Big Bazaar and rationalised operations on the home retail front, including merging its offline and online home retail divisions under a single entity called Praxis Home Retail. The latter has since been listed on the bourses.
The group counts Future Consumer and Future Lifestyle Fashion among its other key listed entities and has in the past few years also acquired over seven supermarket chains, including EasyDay and Nilgiris, taking its total store count to over 1,400 in 400 cities.
Nov-2019
US private equity fund invests over 244 million dollars in Future Lifestyle Fashion
U.S. private equity firm Blackstone has invested Rs 1,750 crore (244.2 million dollars) in Future Lifestyle Fashion (FLF), India’s Future Group’s flagship fashion business. FLF owns several retail chains including Central and Brand Factory. Its an equity and debt deal that the lifestyle retailer has used to reduce pledged stock and potentially pare other liabilities.
Blackstone acquired about 6 percent stake in FLF for about Rs 545 crore last July, in a secondary market transaction. Biyani and family own 53.43 percent of FLF through entities such as Ryka Commercial Ventures, Central Departmental Stores and Future Enterprises among others. Other investors in FLF include L Catterton and PremjiInvest, which together own around 17 percent, L&T Mutual Fund that owns 4 percent, and LIC with 6.5 percent stake, recalls the ‘Economic Times’.
Both companies have advanced that Blackstone will infuse capital in FLF through a combination of equity and structured debt that will fund the capital expansion of Biyani’s deep-discount retail format Brand Factory, which is modelled on US retailer TJ Maxx, besides improving his promoter-level leverage
Blackstone acquired about 6 percent stake in FLF for about Rs 545 crore last July, in a secondary market transaction. Biyani and family own 53.43 percent of FLF through entities such as Ryka Commercial Ventures, Central Departmental Stores and Future Enterprises among others. Other investors in FLF include L Catterton and PremjiInvest, which together own around 17 percent, L&T Mutual Fund that owns 4 percent, and LIC with 6.5 percent stake, recalls the ‘Economic Times’.
Both companies have advanced that Blackstone will infuse capital in FLF through a combination of equity and structured debt that will fund the capital expansion of Biyani’s deep-discount retail format Brand Factory, which is modelled on US retailer TJ Maxx, besides improving his promoter-level leverage
Jan 2020
Amazon had acquired a 49% stake in Future Coupons, which holds about 7.3% in Future Retail through convertible warrants, the company that holds Biyani’s BigBazaar retail chain.
Future Retail raises USD 500 mn from international bond market
As per the company, the bond transaction also marks the first international bond deal from the retail and consumer sector space in India.
The notes will be listed on the Singapore Exchange Securities Trading Limited (SGX- ST).
“The transaction witnessed 37 per cent participation from Asia, 42 per cent from the US and 21 per cent from EMEA with 84 per cent investment from long haul funds, 8 per cent from private banks, 5 per cent from insurance/pension funds and 3 per cent from banks and others,” the filing said.
It further added that there has been strong demand from most of the blue chip names amongst the largest funds across the globe.
Deutsche Bank, Standard Chartered Bank, Barclays, J P Morgan and UBS acted as Joint Global Coordinators and Joint Bookrunners on the issue. SBICAP, Credit Suisse, Emirates NBD Capital and Rabobank acted as Joint Bookrunners, while A K Capital acted as Financial Advisor to the Issuer. (PTI)
With strong sales and brand value FUTURE RETAIL made high upto 656 but falls upto Rs 70
Here is the reason ?? why ??
As of March 2019 Future Retail Debt Increased to 2553.98 Cr and Liabilites increased to 6405.93 Crore
The Covid-19 pandemic induced stock market carnage coupled with high debt levels has put promoter Kishore Biyani in a tight spot
Biyani, whose business appeared to be cruising along well, having struck several deals across group companies with the likes of Amazon, private equity firm Blackstone and Japan’s Nippon group in the last six months and whose group raised its first offshore bond in January, has seen his business upended in the last few weeks.
The combined headwinds of debt and Covid-19 panic have led to Future group stocks—Future Enterprises, Future Lifestyle Fashion, Future Retail and Future Supply Chain Solutions, losing 48-68% of their value since the start of the year.
The situation has led to panic among lenders and sent Biyani scurrying to provide more collateral for his pledged shares to soothe his lenders. But the task has not been an easy one so far.
On Tuesday, group company said that certain lenders who held NCDs through IDBI Trusteeship Services Ltd have invoked promoter pledged shares worth 8%. In a stock exchange filing, IDBI Trusteeship said that it had invoked the shares since an event of default has occurred.
The move came after rating agency Icra on Friday downgraded Future Corporate Resources Pvt. Ltd, a promoter entity, to junk rating of BB+ from its previous rating of BBB- (ratings below BBB- are considered below investment grade). The downgrade, the agency said, was on account of high group level debt and falling stock prices which were bound to put pressure on promoter pledges.
“Despite monetization of investments across various Group entities, the total Group debt has increased as on 31 December 2019, as against 31 March 2019. Icra notes the increase in debt is mainly on account of an increase in debt of the opcos, with the total debt at the Group’s listed companies increased to 12,778 crore as on 30 September 2019 from 10,951 crore as on March 31, 2019," the rating agency said.
Bombay HC restrains IDBI trustee from selling Future Retail's share until further orders
In a major relief to the promoters of the Future Group, the Bombay High Court on Monday restrained IDBINSE 0.52 % Trusteeship and others from selling the pledged shares in Future RetailNSE -4.97 % until further orders. The court will consider the case next on May 4. Two group companies of the Kishore Biyani-promoted Future Group - Future Corporate Resource (FCRPL) and Rural Fairprice Wholesale Ltd (RFWL) - approached the court on Monday to restrain the trustee from selling the pledged shares. The other respondents in the case are UBS AG’s London branch and IDBI Bank
Future Retail’s share price has fallen from Rs 350 on the date of the debenture trust deed to Rs 303 at the start of this month, due to the market collapse in the wake of the Covid-19 crisis, senior counsel Vikram Nankani and lawyer Somasekhar Sundaresan argued in the court on behalf of the Future Group. As per the debenture trust deed, the defendants are fully secured, they said
If the shares are sold in the current situation, it will cause irreparable loss to the promoters and hence the trustee should restrain from selling the pledged shares until the next date of hearing, the counsels pleaded in the court.
While countering this, lawyers for the IDBI Trusteeship argued that it had to recover more than Rs 650 crore from the company and as per the current market value, the shares were worth not more than Rs 350 crore and hence there was no question of granting any ad-interim relief to the company at this moment. Justice, KK Tated said considering the current situation of the market and Covid-19, he was of the opinion that FCRPL and RFWL required protection till the next date of hearing.
Fitch Ratings on Thursday said it has downgraded Future Retail's rating and put the company on Rating Watch Negative (RWN) list reflecting heightened risk to its liquidity position. In a statement, Fitch said it has downgraded the firm's Long-Term Issuer Default Rating (IDR) to 'B-(EXP)', from 'BB(EXP)', and the expected rating on its USD 500 million 5.6 per cent senior secured notes due in 2025 to 'B-(EXP)' with a Recovery Rating of 'RR4', from 'BB(EXP)'.
The downgrade, Fitch said, reflects the heightened risk to FRL's liquidity position due to a sharp fall in its share price, which has prompted lenders at its promoter shareholder - Future Corporate Resources Pvt Ltd (FCRPL) - to demand more of FRL's shares as collateral.
Nearly all of FCRPL 41.1 per cent stake in FRL has been pledged to lenders and certain lenders are attempting to invoke pledges on shares that amount to an 8 per cent stake in FRL following a breach of the collateral coverage requirement.
This has raised the risk of a reduction in the stake held by permitted holders, primarily the promoters - Amazon.com, and related entities - which together hold around 49 per cent stake in FRL, to below 26 per cent; a threshold that could trigger a change of control redemption on FRL's US-dollar bond.
"The RWN reflects the high and immediate risk to the promoter group's efforts to reduce share pledges and restore financial flexibility at FCRPL in a timely manner, particularly in the current challenging environment, which has seen a continuous drop in FRL's share price amid the coronavirus pandemic. FRL's liquidity position is vulnerable to a prolonged pandemic and a failure to resolve the debt situation at FCRPL could damage FRL's relationships with lenders, compounding the overall liquidity ..
Fitch Ratings said it aims to resolve the RWN upon further clarity on FCRPL's plan to resolve the debt situation and improve its financial flexibility.
"These steps, if successful, will raise financial flexibility at the promoter entities and lower the risk of a change of control being triggered for the redemption for the US-dollar bonds. Nonetheless, a subdued valuation, a high level of share pledges at the group's other listed entities and a lack of liquidity in the current environment pose risks," it said.
"These steps, if successful, will raise financial flexibility at the promoter entities and lower the risk of a change of control being triggered for the redemption for the US-dollar bonds. Nonetheless, a subdued valuation, a high level of share pledges at the group's other listed entities and a lack of liquidity in the current environment pose risks," it said.
FRL's stores will remain open, but can only sell groceries and other essential items that carry lower margins compared with discretionary items, such as apparel.
"We believe this will significantly hurt FRL's profitability and cash flow in the quarter ending June 2020, followed by gradual stabilisation over the following few quarters," Fitch said adding the company's banking relationships will enable it to secure additional lines to manage the increased liquidity needs over the next f ..
Further steps ...
"We believe this will significantly hurt FRL's profitability and cash flow in the quarter ending June 2020, followed by gradual stabilisation over the following few quarters," Fitch said adding the company's banking relationships will enable it to secure additional lines to manage the increased liquidity needs over the next f ..
Further steps ...
“The situation is tough and Future needs money. Retail sales are already slackened due to a slowdown because of the virus outbreak. Buyers are there for Future Lifestyle because the business is readymade and running but one has to be flexible with the valuation. If the stock fall due to the bad market condition is controlled, a valuation of up to 6,000 crore looks comfortable," said the first person.
Future Lifestyle sale mandate was given to Arpwood Capital last week. The money from the sale proceeds is to be used primarily to repay debts of Future Group, said the first person.
An Arpwood spokesperson declined to comment on the matter. Emails sent to the Future group did not elicit a response.
Future group promoters are also trying to raise fresh capital at the promoter level, through a combination of equity and structured debt, said another person, also speaking on condition of anonymity.
“The promoters are engaged in talks with various investors to raise money. They would need an infusion of around 1,000-1,500 crore in the near term," he said.
The fact that state governments across the country are effecting lockdowns in major cities and districts is also not helping the promoters’ cause, he added.
With most state governments asking all non-essential business activities to shut down, Future group stores, especially the apparel business under Future Lifestyle Fashion has been almost entirely closed and several retail stores of Future Retail are operating only their grocery sections. This is expected to reduce the operating revenues of these companies, further compounding the problem for Biyani.
To be sure, Biyani is not new to these troubles.
Future group was caught in a debt trap when India’s economic growth started slowing down in 2010.
That episode saw Biyani sell his apparel store business Pantaloons to Aditya Birla group and his financial services business Future Capital to Warburg Pincus.
Note : All the above information about the company and business are collected from various channels. All details are public available information. There is no scope of recommendations or promotion on company
Stay Updated.... If you feel the information is worth useful for you, please leave your comment