Europe’s fourth-biggest retailer, Metro AG, said it wants India to become one of its “focus expansion countries”, alongside Russia, China and Turkey. “We have seen continuous like-for-like growth recently in India. Now we decide to inject extra momentum into our expansion course there,” Metro CEO Olaf Koch confirmed.
The company is planning to have 50 wholesale stores in the country by 2020, up from 16 now. Metro has been active in India with its cash-and-carry business since 2003 and is one of the few foreign retailers operating in the country. Besides stores in major cities such as Delhi, Bangalore, Mumbai and Kolkatta, the company has chosen a regional expansion to Tier 2 cities such as Indore, Jaipur and Vijaywada. It has also built up a geographic focus in one state, Punjab, with stores in Amritsar, Chandigarh, Jalandhar and Ludhiana.
In 2012, the Indian government gave foreign supermarket chains the green light to enter its $500 billion retail sector. Full foreign ownership of supermarkets that sell directly to consumers is restricted. Metro sells goods to small shopkeepers, which dominate India retail market.
May 5, 2014 No Comments
India has overtaken China as the most attractive investment destination, according to Ernst & Young (EY), with the sharp depreciation in the rupee and opening up of new sectors to foreign players boosting the South Asian nation’s allure. This according to report published on CNBC. Companies are most likely to invest in India, followed by Brazil (2), China (3), Canada (4) and the United States (5), EY’s ninth bi-annual Capital Confidence Barometer – a survey of 1,600 senior executives across more than 70 countries – showed. Other nations in the top 10 are South Africa (6), Vietnam (7), Myanmar (8), Mexico (9) and Indonesia (10).
Sectors with the highest level of possible deals in India include Automotive, Technology, Life Sciences and Consumer Products.
The survey reported that 38 percent of the respondents feel that Merger and Acquisition volumes in India are expected to improve over the next 12 months, while 30 percent believe that these will remain stable. “The investor outlook for India remains positive, despite the challenges the country’s economy has faced in the recent past. At the same time, the improved condition of the world economy has helped increase confidence amongst deal makers, prompting them to take a bolder stance toward executing transactions,” said Amit Khandelwal, National Leader & Partner — Transaction Advisory Services, EY. “After two years, European countries (Britain and Germany) have made a comeback on the potential investment destinations list for Indian companies,” the report said. In August, the Indian government announced relaxation in foreing investor norms in many sectors, including multi-brand retail and telecom.
December 11, 2013 No Comments
The rise of Eastern economies is more properly called the “return” of these erstwhile economic powerhouses, especially China and India.
(Note that Angus Maddison did not seem to value the pre-Columbian nations of the Americas at all in his analysis, so the numbers are perhaps a bit skewed).
June 6, 2013 No Comments
According to Los Angeles Times, visitors from China are now the biggest-spending travelers to the U.S.
In all of the U.S. the average spent as a whole by Chinese visitors is $7,105, by Indian visitors is $6,659, by Brazilian visitors is $5,604, and by Japanese visitors is $4,541.
In California alone, Chinese visitors spend an average $2,932, Brazilian visitors spend an average of $2,404, Indian visitors spend an average $1,983, and visitors from Japan spend $1,969. Roughly 33% of their spending goes towards gifts and souvenirs for family and friends. They spend so much that they helped set a record for spending by foreign visits to the U.S. – $168.1 billion in 2012.
Chinese tourists spend mostly on high-end clothes and accessories featured in American movies because steep Chinese taxes make such brands two to three times more expensive in China. In addition, Chinese tourists stock up on vitamins because they are dubious of supplement quality sold in China.
What this means
When I first began living in California, it was busloads of Japanese tourists that drove retail, recreational and tourist spending. This was followed by investors from Japan starting to buy up hotels, office buildings and more. In recent years returning Chinese tourists seem to have sparked a mini-real estate boom on the West Coast as homes are swept up in all-cash offers. Expect an Indian wave of real estate investors soon.
June 6, 2013 No Comments
According to an article on EMSnow.com, labor costs in China are rising fast due to pressure from human right organizations but also from government regulations to avoid social unrest and rising middle class expectations. CBA forecasts that the costs might keep increasing in the next two or three years. According to the article, electronics manufacturing data shows that there is not an unlimited supply of cheap labor in China, despite the huge population.
Moreover, according to the Economist, the increase of the costs has started in the coastal provinces where factories have clustered. In 2012, an investment bank has released a survey which stated that wages had already risen by 10% that year. According to Dale Weathington from Kolcraft (an American firm that uses China contract manufactures to make baby stollers in southern California), China’s coastal provinces are losing their power to draw workers out of the hinterland. In previous years 95% of Mr Weathington’s contract staff returned to work after the Chinese new year, compared to only 85% in 2012.
May 16, 2013 No Comments