Demonetisation has been a 'blessing in disguise': Lalit Agarwal of V Mart

In a chat with ET Now, Lalit Agarwal, CMD of V-Mart spoke about the immediate impact of demonetisation and how the company was able to get good demands from consumers. Edited excerpts:

ET Now: One would have thought that demonetisation is going to impact the consumer trends but that has really not been the case, at least Q3 the earnings have not really shown that. What has your reading been on ground?
Lalit Agarwal: I think for us demonetisation has been a blessing in disguise. We had a good impact post demonetisation also and we saw demand was already there, undercurrent was there of demand supported by all these events which happened, good monsoons, lot of marriage dates, even good winter season. I think otherwise whatever we do and whatever we sell we saw good amount of demand in the market. Yes, there was some cash crunch but people had money. People had money in the banks and people came all out to spend money through their debit cards.

The debit card transactions went up too much, too high and even now the debit card and the credit card transactions are there in a stable limit. So I think there is an demand which is there and people want to consumer, people want to spend more, they want to look good, they want to better the lifestyle and this is coming out through the aspiration of the youngsters and the youth which live in this smaller towns and so everyone is exposed to the same media, everyone wants to look like their role model so I think this is very good thing which is happening in the economy and we are very positive about it.

ET Now: Can you me an approximation of which are the categories where growth is strong and where the impact of cash ban has not been there?
Lalit Agarwal:For us apparel is the major contributor of sales, almost 82% of our sales comes from apparel and other 12% comes from non-apparel which includes all the foot wares, home and stuff.

I think these two segments in particular has performed very well. People have not lessened their spending, people have rather increased their spending because they are very clear now the economy is supposed to grow, growth is bound to come in, government is going to get benefitted.

There are lot of opportunities and the spending with the government is going to do. I think this budget has also been good booster. Lot of spending is directed towards rural which will ultimately come up to tier III towns and cities at the district level because people do consume and people it is happiness all around I see because yes there were few constraint on the queues and stuff but I think except discretionary yes, we do not sell discretionary, everything what we sell is needful.

Yes some part of the items that we sell would be discretionary to certain segment of the people who has those income range and they would spend only during marriages or particular festival so I think there has been a little downtick in the higher value apparel but otherwise we are seeing a good growth.