Shoppers Stop

The financial year 2007-08 has been a challenging one for your Company.
 On the one hand your Company has shown substantial like-to-like sales
 growth of 20%, across all formats, overall chain level growth in sales
 of 34% and has also improved Gross margins by 37% and has continued on
 its path of organic growth through its various formats. On the other
 hand the imposition of Service Tax on rentals has resulted in
 unprecedented cost pressures.
 
 Your company has crossed the Rs. 1 billion revenue mark and has
 achieved revenues of Rs.12069 Mn for 2007-08, a growth of 34% over the
 same period last year.  Whilst Sales per sq.ft. increased by 9%,
 Customer Entry and Transaction size was up by 28% and 10% respectively.
 Your Company has delivered a Gross Margin of 32% on sales, of Rs. 3,810
 Mn, a growth of 37% over last year. The Net Profit after Tax is Rs.70
 Mn.
 
 The retail sector continues to grow in a frenetic manner. Every new day
 appears to present a new opportunity. In keeping with the various
 opportunities that organized retail in India offers your Company has
 launched certain new formats in 07-08, in addition to expanding the
 Shoppers Stop stores and existing formats.
 
 The year gone by saw us expanding the number of Shoppers Stop stores to
 24, with 3 new stores being added in the Delhi/NCR region and 1 new
 store added in Kolkata.  We.have launched a brand new format called
 Amelia which retails high end non-apparel and accessories for ladies.
 Amelia , as a concept, is designed as an indulgence zone for the urban
 woman.  In what is a clear indication of our strengthening ties with
 our international partners, we also opened the first Clinique store in
 the country in Delhi. Clinique is a highly sought after brand from
 Estee Lauder which has products related to skin care. It is my pleasure
 to inform you that our duty paid stores in the new Hyderabad and
 Bengaluru airports also opened in March-08 and May-08 respectively and
 have clocked impressive figures. In addition to the above we continue
 to expand our presence through our various formats viz.  Mothercare,
 M.A.C, Home Stop, Crossword and our F&B outlets.
 
 Nuance Group (India) Private Limited, which is the joint venture
 company between Shoppers Stop Ltd. and The Nuance Group AG, opened its
 first duty free stores in India, in the Hyderabad International Airport
 in March 08.
 
 The Bengaluru duty free airport stores opened in May-08. Your company
 has always looked at taking pioneering steps in the retail business and
 in all aspects related to it. To that end we have launched our
 catalogue retailing business through our Joint venture company Gateway
 Multichannel (Retail) Ltd., which has opened 5 stores in Thane in the
 past financial year. Initial response to this business has been quite
 encouraging. The Company is also actively progressing towards setting
 up an e-commerce portal to be able to offer its products for sale
 through the internet.  Your Company believes, that through its various
 brick and mortar formats, airport stores, catalogue stores and the
 internet option, the Shoppers Stop retail group will be in touch with
 the customer on a 365 days x 24 hours basis.
 
 It gives me immense pride to announce that your Company received the
 Emerging Market Retailer of the year at the World Retail Congress
 Awards 08 which is indeed a huge achievement and honour for us. In
 addition to that your Companys Managing Director, B.S. Nagesh, was
 inducted into the World Retail Hall of Fame, the first Indian to be
 given this honour.
 
 The management of your Company has always believed in keeping pace with
 its customers aspirations and has continuously endeavoured to be
 relevant to his/her lifestyle needs. To that end, your Company
 undertook the project of changing its logo and bringing in a new brand
 philosophy for Shoppers Stop as a brand. The new logo was launched in
 April 2008.
 
 The new logo, whilst retaining the earlier virtues of Trust, Comfort
 and Warmth, also reflects the brands new character as an Inspiring
 guide, a Progressive & Dynamic brand and an Imaginative Thought leader.
 
 It is important to note here that this has not been a mere change of a
 logo. The exercise goes far beyond that and has been extended to change
 the various touch points that each customer experiences both within our
 stores and external to our stores. Your Company believes that these
 changes will go a long way in maintaining its leadership position in
 the departmental store category.
 
 Your Company believes in being socially responsible. In addition to
 local initiatives at store level, we have also started the Think
 Green initiative that involves the planting of 1.5 lakh neem trees in
 a span of 90 days by distributing neem seeds with merchandise.
 
 The countrys first retail loyalty program started by your Company, the
 First Citizens Club, crossed the 1 million mark during the year. Having
 contributed 65% to the years sales, our First Citizens continue to be
 a pillar of loyalty & support for the business.
 
 The Indian economy has embarked on a robust growth path and with that
 the prospects of the organised retail industry can only grow brighter.
 Your Company is very well poised to take full advantage of this growth
 and continue to stay ahead of its competition. Your faith and trust in
 the Company and the untiring efforts of its employees will surey
 succeed in the Company retaining its LEADERSHIP position.
 
                                                   Chandru L. Raheja
                                                            Chairman