Provogue plans Rs 90-cr expansion

MUMBAI: Provogue India, a Mumbai-based retail company, has announced a Rs 90-crore expansion plan, which will be funded through internal accruals and a preferential offer made earlier. The company had raised about Rs 314 crore through a preferential offer to Acacia Partners, T Rowe Price, Genesis and others.

���Provogue plans to expand in tier 2 cities by having ten new Promart stores- a smaller retail part of Provogue - in cities such as Jaipur, Lucknow and Coimbatore,��� said MD Nikhil Chaturvedi.

The Promart retail store chain typically has stores of 300,000 sq ft and is looking at enjoying a 10% share of the $25-billion retail market by 2010. Promart stores are located in Indore and Ahmedabad. Provogue is also expanding its exclusive brand outlets, which have a store size in the range of 1500 sq. ft. to 6000 sq. ft.



���The garment business offers less margins and we want to raise our gross margins from the current 35% to 40% by bringing in new brands,��� Mr Chaturvedi told ET. The company is waiting till December to get a clear picture of its sales, he added.
With the rising raw material prices, many garments manufacturers are taking to retail expansion in the tier 2 cities.

Future Group���s Pantaloon Retail plans to open Big Bazaar outlets in the southern cities such as Chennai, Tiruchirapalli, Madurai and Tirupur. The Aditya Birla Group owned Madura Garments intends to introduce Espirit���s urban women���s wear collection after increasing its existing 39 point-of-sales stores to 60 by end of the current financial year.

Provogue is a Rs 336.8-crore company. It registered a net profit of Rs 6 crore in the quarter ended June 30, 2008. The shares of the company rose 1.4% to Rs 690 on the BSE on Wednesday.