Subhiksha plans IPO in 2008

The Chennai-based discount retail chain Subhiksha Trading Services said that it would announce its initial public offering (IPO) this year. Mr R Subramanian, Managing Director, said, “We will announce the IPO this year. In fact, I would be very surprised if that doesn’t happen this year. However, I will restrain from putting a time limit of say three months or six months to it.” According to earlier reports, Subhiksha had planned its IPO by the second half of 2007, as soon as it completed 1,000 stores across the country. Mr Subramanian said, “We were supposed to float the IPO after we completed 1,000 stores. However, today we are well above that mark and about to touch the 1,400-1,500 store mark by March, and are still well stacked in terms of finances.” He said the company was still evaluating market conditions with a team of its in-house venture capitalists, consultants and accountants, all of whom are members of the company’s board of directors. Mr Subramanian had earlier said that the IPO was more for the purposes of listing than raising money for expansion. He had said, “We want the IPO to give liquidity to shareholders.” Subhiksha is a discount format modern trade organisation that operates through four verticals — fruits and vegetables, pharmaceuticals, FMCG and telecom. Its direct supply arrangements with manufacturers help it reduce the supply-chain costs, in turn helping it keep prices of all products much lower than the market levels. The company was formed in 1997 in Chennai, and currently operates over 1,000 outlets across 90 cities. ICICI Venture Capital holds 24 per cent in the chain. source: Hindu Business Line