Future RETAIL
BIG PICTURE OF THE QUARTER
Q2 FY 2018-19
|
FUTURE RETAIL
|
Sep '18
|
Jun '18
|
Sep '17
|
YOY
|
QOQ
|
||||
|
Net Sales
|
4,929
|
4,539
|
4,506
|
9.37
|
8.59
|
||||
|
Purchase of Traded Goods
|
3,747
|
3,502
|
3,5031
|
6.97
|
7
|
||||
|
Interest
|
55.39
|
51.09
|
49.66
|
11.54
|
8.42
|
||||
|
Net Profit
|
175.1
|
153.12
|
153.16
|
14.32
|
14.35
|
||||
|
Equity Share Capital
|
100.51
|
100.5
|
97.96
|
2.6
|
0.01
|
||||
|
Basic EPS
|
3.48
|
3.05
|
3.13
|
11.18
|
14.1
|
||||
|
MP
|
449
|
||||||||
|
PE
|
32.25575
|
||||||||
|
VOLUME
|
20 LAKHS
|
||||||||
|
FV
|
2
|
||||||||
|
52W L H
|
423
|
639
|
|||||||
|
PRICE TREND
|
|||||||||
|
05.01.19
|
1 week
|
2 week
|
1 mnth
|
3 month
|
6 mnth
|
9 mnth
|
1 yar
|
||
|
Price
|
510.35
|
546.1
|
525.85
|
441
|
558.3
|
545.8
|
554.5
|
||
|
Gain / Loss
|
-11.99%
|
-17.75%
|
-14.59%
|
1.85%
|
-19.55%
|
-17.71%
|
-19%
|
||
*Underlying Y-o-Y growth adjusting for eZone rationalization and
HomeTown demerger
BALANCE
SHEET
PARTICULARS
(RS.cr)As at 30 Sep 18 As at 31 Mar 18
Shareholders'
Funds 3,433 3,096
Net Debt 1,479 1,103
Total
Capital Employed:4,912 4,199
Less: Investments 68 0
Net
Adjusted Capital Employed 4,845 4,199
Fixed Assets
1,338 1,052
Net Non-Current Assets 236 236
Net Current Assets 3,271 2,912
Total Net
Assets : 4,845 4,199
Margin expansion continues with EBITDA expanding by 18%
on Y-o-Y basis to reach 5.1%
Over 13 consecutive quarters of almost double digit SSG
at Big Bazaar . 9.4% in Q2FY19
NETWORK SNAPSHOT
Present in 373 cities with 1,336 stores
Over
50 cities with >1 million population have a Big Bazaar store
In
last 12 months, CO has opened 26 large stores in Tier 2/3 towns
Only
company to have 15 stores in hilly regions & the North East
BUSINESS SNAP SHOT
The
festive season moved from 15 th Sep–15 th Oct ‘17 to 05th Oct - 05 th Nov ’18: Festive growth has been
18% Y-o-Y
Improvement
by ~20% in footfall conversions
Continued
strong roll-outs of key membership programs like Future Pay & Easyday
Savings Club
FRL STORE NETWORK
LARGE FORMAT :
BIG BAZAAR 284 STORES:143 CITIES : 12.4 ML SQ FT
FBB 74 39 0.8
FOODHALL 10 5 0.1
SMALL FORMAT
959 273 2.1
EASYDAY CLUB
WH SMITH AADHAAR
OTHERS
EZONE 9 6 0.1
CUMULATIVE 1336 373 15.4
·
9 SMALLER FOOD
BAZAAR Stores In Hyderabad Were Converted To Heritage Stores; WH.Smith Stores
Included
Y-O-Y GROWTH : 877+459 (SEP
17) =1336 (SEP 18)
12.7 MLN SFT +2.7 MLN =
15.4MLN
Large Format Performance:-
SSG% EBITDA%
HYPERCITY EBITDA%
Q2 FY 18 =13.8% 6.4% Q4FY18
-20.2%
Q1 FY 19 = 10.1% 7.9% -11.3%
Q2 FY 19 = 9.4% 7.7% -6.7%
ON TRACK TO ACHIEVE 5%
EBITDA IN UPCOMING QTR
Small Store Membership
: Continues To Strengthen:
·
TOTAL MEMBERS :
8,00,000
·
AVG : 1630 MEMBERS
PER STORE (> 1 YEAR)
·
MEMBERS VISIT :
>3 TIMES A MONTH
·
ANNUAL SPEND PER
MEMBER : >35,000
·
MEMBERSHIP ACTIVE
IN 715 STORES
EASY CLUB MEMBERS (IN MLN)
SEP 17 = 0.3 + (>2.5 X
GROWTH) = SEP 18 :0.8 MLN
FUTURE RETAIL :-
· >7.8 MLN USERS
· SALE OF RS.6000 CR ON ANNUALISED BASIS
· 32% YoY INCREASE IN TOTAL TRANSACTIONS DURING THE QTR
· AVG SPEND PER USER OF > RS.700
· >4 MLN PRICE MATCH TRANSACTIONS
Impact Assessment
§ Footfalls:
250,000 (40% conversion rate)
§ Revenue:
Rs. 50cr at an ATS: Rs. 2,075 and a high GM%
§ Young and sticky customers generated
§ ~600,000 coupons given in H1 FY19
Q2 FY 19 PERFORMANCE SUMMARY
SSSG%
BIG BZR : Q2 FY 18 :13.8%
: Q1 FY 19 : 10.1% : Q2 FY 19 : 9.4%
FUTURE RETAIL : 10.2 % :3.6% :
5.9%
H1 FY 19 PERFORMANCE SYUMMARY :
· INCOME :
9211 +9.3% = 9467
· GROSS
MARGIN : 2334 OR 25.3% TO 2,559 OR 27%
· EBITDA :
4.6% OR 426 TO 5% OR 478
· *Underlying
Y-o-Y growth adjusting for eZone rationalization and HomeTown demerger
· ROCE : 19.4% ;
· ROE : 20.1%
· INVENTORY DAYS(REVENUE) :sep 17 : 79; mar 18 : 87 ; sep 18 : 90
NEW FDI POLICY
ON E COMMERCE
Government
on December 26 announced several restrictive changes to the FDI policy for
online retailers. To check deep discounting and predatory pricing. Government
has barred online retailers from entering exclusive deals for selling products
on their platforms.
Government
has also enforced a 25 percent cap on the inventory that an e-commerce platform
can purchase from a single vendor.
The
changes will come into effect on February 1, 2019.
BHARTI ENTERPRISES SELLS :
Bharti
Enterprises sells Future Retail's shares worth around Rs 300 crore. The shares
were bought by Edelweiss group,
In
June, Bharti group entity Cedar Support offloaded 6 percent stake in future
retail for Rs 1,697 crore through open market transactions.
Earlier
in May 2015, Future Group had acquired Bharti Group's retail business under the
EasyDay chain in an all stock deal worth Rs 750 crore to create one of the
biggest super market chains. Following the deal Bharti Group's retail business
had merged with Future Retail.
AMAZON HOLDING
Kishore
Biyani may be widening the scope of a deal with Amazon that will allow the US
giant to buy him out in future, reported The Economic Times.
both
parties have added an option to the share purchase agreement that allows Amazon
to buy out Future Group Retail (FRL) over an extended period of time, possibly
about 8-10 years, subject to Indian laws.
Amazon
and Future Group are in the final stages of their deal wherein the Jeff
Bezos-led company will acquire 9.5 percent stake in FRL as a foreign portfolio
investor (FPI).
The official announcement of the deal was expected in December.
Kishore
Biyani and his family hold 46.51 percent of the company, of which 40.3 percent
is pledged.
"Amazon
is betting that with gradual FDI relaxation in food processing and single-brand
retail over time, the current freeze will be removed. Meanwhile, a clear
realignment involving global players is happening in Indian retail and Biyani
would want to capitalise on that," a source said, on condition of
anonymity.
The
Seattle-headquartered company picked up a 5 percent stake in Shoppers Stop last
year and acquired More supermarket chain through Samara Capital earlier this
year. It was reported that the retail giant was also in talks with Spencer's
Retail.
To
break into India's growing retail market, Amazon has been looking to invest in
local brick-and-mortar stores.
The
report said Amazon may give a 'control' premium of about 25-30 percent for
their right to call upon the shares, although sources said the details of the
deal are being worked out.
The
UPA government had allowed up to 51 percent investment from foreign investors
in local stores. This was changed when the BJP government came to power and
stopped fresh investment in the retail sector.
Under
the current regime, the way to circumvent this rule is through the FPI route. A
single FPI can hold up to 10 percent stake in multi-brand retail companies.
Not
just retail, the two companies are partnering in fashion and fast moving
consumer goods. There are plans to merge both their payment options—Amazon Pay
and Future Pay—to create a bigger entity.
