Slide 1

By: Dheeraj TripathiRoll no: 1301-065Section APGDM 2013-15

Case Analysis: Big BazaarIndian Retail MarketWorlds eighth largest at $250 billion12 million retail outletsRetail sales represented 33.3% of Indian GDPIn 2005, modern Organized retail market had 3.5% share of Indian retail market

RETAIL FORMATSValue Retailing: Segment Revenue Rs. 61666.04 lakhs on 30.6.2005

Lifestyle retailing: Segment Revenue Rs. 37637.97 lakhs on 30.6.2005

3StoreYear of commencementStores(as on date)Big Bazaar2001162Food Bazaar200231Central200422Brand Factory200626Home Town +Ezone200751FBB200827Food Hall20114+2Planet Sports +aLL201168I am in20133Store Details

Big Bazaar: 4 PSCustomer PerceptionPOSITIVES

Large storesVarietyValue for moneyPromotional OffersQualityHigh Volume, Low price

NEGATIVES

Costlier than neighbourhood storeLong QueuesNo CreditSnob EffectFOOD BAZAARConcepts borrowed from Western markets:

ConvenienceCleanlinessHygienePre packaged commodities

Indian-ness added:

Touch-feel-doSelect bag weightBazaar like atmosphere

20012002200320042005Shareholders funds8.312.4315.5721.4350.9711.501.882.586.14Total loans16.0225.2733.4954.3365.8611.582.093.394.11D/E Ratio1.932.032.152.541.29Net Block 8.2915.7124.6936.9149.1811.902.984.455.93Work in progress1.811.450.763.323.63Investment1.171.171.211.217.34AssetsInventories 12.9620.1126.3236.3663.49Total Current19.0530.3838.2452.9292.9311.592.012.784.88Total Current Liabilities6.1610.8415.2916.933.3211.762.482.745.41Current Ratio3.092.802.503.132.79Figures In $ million20012002200320042005Total Sales41.6565.65102.36151.48249.4311.582.463.645.99Total Expenses38.2660.5193.75138.64229.5111.582.453.626.00After Tax Earning1.471.622.634.558.8711.101.793.106.03NET Profit margin (PAT/Sales)0.0350.0250.0260.0300.036ROCE (PAT/Equity+Loan)0.0600.0430.0540.0600.076Figures In $ millionFindings:PAT rose from $1.47 mn in 2001 to $8.87 mn in 2005Increase of roughly 6 timesBut Profit margin remained almost constant (3.5% to 3.6%)

Pantaloons marginally contributed to growthSales increase of 6 times during 2001-2005D/E ratio high in 2003 and 2004 signifying expansion

7 BB from 2001-03 while 12 from 2004-059 FB from 2002-03 while 24 from 2004 to 2005

SCM improved. Central warehouse in NagpurImplementation of SAPThank You