Vishal Retail IPO price band fixed

Vishal Retail, which has roped in high-profile investors like the Burmans of Dabur India, Munjals of the Hero group and HDFC, is all set to make a debut in the primary markets.



The price band has been fixed at Rs 230-270 per share and the IPO will open on June 11 and close on June 13. The proceeds raised from the issue will be invested in establishing 32 new retail stores.



At present, it operates 50 stores, spread over 12.82 lakh square feet, located in 18 states. In a statement issued to the media, Vishal Retail said that it proposes to deploy Rs 104 crore from the net proceeds of the issue towards setting up additional stores in fiscal 2008.



Vishal Retail that started as a retailer of ready-made apparels in Kolkata in 2001 broadened its business portfolio. It diversified its product offerings to include other retail goods such as footwear, toys, watches, toiletries, grocery items, sports items, gifts and novelties.



Unlike other large retailers like Pantaloon, Shoppers' Stop, Reliance Retail, which have a pan-India strategy including metros, Vishal Retail will focus its attention on tier-II and tier-III cities. Products in its malls will target an income group of Rs 5,000 to Rs 50,000 per month. R C Agarwal, chairman of Vishal Retail, said: "In the next 3-4 years, we expect that this market will grow faster than the big cities."



In FY07, the apparel business contributed 63% of revenues, while the non-apparel business contributed 22% and the FMCG sector 15%. The revenue mix is expected to change further with the company eyeing more into FMCG, Agarwal added.

The retail chain's IPO will coincide with India's biggest share sale by DLF.



DLF's issue opens on June 11. Once listed, Vishal will join a handful of Indian listed retailers, including Pantaloon Retail (India), Shoppers' Stop, Piramyd Retail and Trent among others. Organised retailing currently accounts for 3% of India's overall $300 billion annual retail market.



Bennett, Coleman & Co., the publishers of The Times of India and Economic Times, has equity interests in the retail chain.