Shoppers Stop seeking more clarity on FDI guidelines

MUMBAI: Shoppers Stop, the country's oldest department store chain, said it is seeking more clarity on whether the government’s latest foreign direct investment (FDI) guidelines could affect its stake sale to Amazon. Nearly two years ago, ecommerce giant Amazon acquired a 5% stake in Shoppers Stop through foreign portfolio investor (FPI) route along with a deal to use each other’s network.
"We are awaiting more clarity of Amazon's investment in our company but there has been no change in the partnership yet. The investment is not through their retail arm and more than 95% of our sales are from our physical stores," said Shoppers Stop (SSL) managing director Rajiv Suri.

The US firm has already opened six Amazon Experience Centres or kiosks, which showcase its exclusive products, within Shoppers Stop outlets. Shoppers Stop will receive commission on sale of Amazon products from its shops, plus rentals. Under the deal, Shoppers Stop also got to use Amazon network to reach online shoppers. The K Raheja Corp-promoted retailer also said it is exploring how they can integrate Amazon's Prime membership in their brick-and-mortar stores operations.

On Monday, it posted its highest same-store sales growth in five quarters at 8.9%. While its net sales for the quarter ended December grew 3.7%, the company said sales grow by 10% after adjusting accounting impact in the base year due to GST and new accounting standard. "December was the best month for us ever with sales of Rs500 crore. The quarterly sales were driven by private brands that grew by 29% while there was a strong rebound in men's apparel segment after low single digit growth a year ago," added Suri.