ORGANIZED RETAIL:

With forced conversion from cash based transactions to cashless transactions (either ecom or card based), the prospect of organized retail industry seems bright. Here are few interesting statistics:

• Organized retail in USA is 85%.
• In India it is 9%
• Indian retail sector is estimated at US$ 630 billion largely dominated by kirana stores.
• By CY 2020, Indian retail industry would be US$1.3 trillion – at a CAGR of 16.7%.
• Indian retail industry is one of the fastest growing industry in the world, growing at 7.45% from FY 2000 to FY 2015.
• Now with Demonitization move and more people switching to organized retail for easy transaction, this growth rate might accelerate.
• Food and grocery accounted for 69% of the total revenue.
• Apparels contribute 8%, with western outfits and readymade garments contributing 40%.
• Jewellery accounted for 6%.
• Total number of online shoppers in CY 2015 was 50 million. It is expected to touch 175 million by CY 2020 : a 3.5 times growth.
• Reliance Retail posted profit before depreciation, interest and tax, growing at 31% to Rs.264 Cr.
• Few of the listed organized retail companies are:
• Reliance Industries (owing Reliance Retail)
• V2 Retail
• Provogue
• Future lifestyle
• Trent
• AB Fashion and Retail
• TITAN
• DMart (to be listed)

Given the growth visiblity, it makes sense to ride the wave by investing in some of these stocks.