CNBC and Bloomberg were abuzz yesterday with the news that India's Bharti and Wal Mart are planning a retail joint venture in India. Bharti will handle the front-end of the business while Wal Mart will handle the logistics and supply chain. Total investment is expected to be $100 million or thereabouts.
The total size of India's retail market is 300 billion US$ and this is expected to increse to 427 bn US$ by 2010. So the pie is large and attractive. However, the Ambanis are also investing 5.5 billion US$ in also setting up a retail venture and the Birlas also planning a similar venture. So the amount being invested by Bharti pales in comparison to the competition.
Let's see how the game plays out. Bharti is planning to roll out the first store by August 2007. With all three of India's smartest business minds and Wal Mart in the fray, this is going to be one hell of a fight.
PS: So now, the unemployed youth and the retired elderly will be able to work as "greeters" in giant retail stores. I can almost see them in their blue uniforms- "Welcome to..."
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3 comments:
I think it is an excellent move by both Bharti and Wal-Mart. It will be interesting to see how many more JV's we will see probably Carrefour, Tesco setting up JV's with someone. Leahy, the Tesco head honcho has already made couple of visits to India in the last six months and everyone knows something is brewing up there.
Not to mention, a golden opportunity for Oracle and SAP to sell more software!
-R
there is opportunities for everyone...but I would say Oracle is better prepared for this considering that they now own Retek (which SAP also desperately tried to buy wth counter offers)
;-)
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