BSE See NSE See 40,544.37
112.77 (0.28%)

DSIJ Mindshare

Future Retail’s first acquisition in e-commerce space

Future Retail acquired owned and operated by Bluerock eServices Private Limited (BEPL). After the transaction,  BEPL becomes the subsidiary of Future Retail.

Future Retail will benefit from acquisition the and it will take Fabfurnish brand in ecommerce space. Another objective is to diversify business into furniture and home furnishing. The company bought BEPL through cash transaction. It purchased equity stakes at Rs 4.86 per share.

On financial front, BEPL has net worth of Rs 19.56 crore and a turnover Rs 78.93 crore as of FY15. According to the Future Retail management, the acquisition will boost EBITDA by Rs 40 to 50 crore. It will also be looking forward to more acquisitions in specialty retail space.

Future Retail’s revenue increased by 25.27 per cent to Rs 3326 crore in Q3FY16 as compared to same period in the previous financial year. The company’s EBITDA declined by 1.94 per cent to Rs 303 crore in Q3FY16 on yearly basis. Its bottom line boosted almost three times to Rs 14.68 crore in Q3FY16 as compared to same period in previous fiscal year. Future Retail’s net profit margin expanded by 24 basis points to 0.44 per cent in Q3FY16 on a yearly basis.

The share price of Future Retail increased by 2.55 per cent on bourses in early trades and is trading at Rs 129 on intraday basis on Wednesday.

Future Retail has trailing twelve month (TTM) EPS at Rs 1.05 per share as of Q3FY16. The company’s share price is trading at PE multiple of 122.48x times. The latest book value of the company is Rs 124.38 per share. At current value, the PB multiple of Future Retail is 1.03x times.

Future Retail is engaged in multi brand retail trade. The company's store networks include around 401 stores in around 122 cities. It operates under various names including Big Bazaar, fbb, eZone, HomeTown and Foodhall. Future Retail is engaged in retail trade such as fashion, food, homeware and electronics, and technology. The company also offers food products through the Big Bazaar hypermarkets and Foodhall gourmet store. Its homeware and electronics retailing business is operated through Big Bazaar and specialty retail chains, such as Home Town and eZone.

collapse Related Readings collapse

DSIJ Mindshare

Indo Count Industries Ltd forays into bed linen markets; locks in at upper circuit

Nidhi Jani / Article rating: 4.3

Looking at the industrial front, China has a 39 per cent share in home textile exports with USD 19 billion, followed by India at 11 per cent with USD 5 billion. India, being the second largest home textile exporter as well as the largest producer of cotton in the world, is expected to benefit from this structural shift.