Expansion plans on; to open 8 new stores in FY16: V-Mart

V-Mart Retail is looking to expand its presence in Tier 2 and Tier 3 cities to add to the company’s sales growth, Lalit Agarwal, CMD of V-Mart Retail told CNBC-TV18. Agarwal said the second quarter growth has seen some downfall due to low monsoon and no festivities. However, he expects a better third quarter, which will be aided by the ongoing festival season. The company is expanding its base and is bullish on smaller cities with high population and untapped market, Agarwal said. As of September 30, 2015 the company has 109 stores across 92 cities. In the current quarter, the company plans to open eight more stores. The company is focusing on expansion in Orissa and West Bengal, he said adding that the aim is to have regular sales growth.Below is the verbatim transcript of Lalit Agarwal's interview with Latha Venkatesh and Sonia Shenoy on CNBC-TV18.Latha: We have seen steady same store sales growth (SSSG) over the previous few quarters but with erratic rains and delayed festive season, how are you gauging your performance for the next two quarters?A: It is not very bullish. We are seeing some downfall in the growth pattern. So it can be an effect of the monsoon and some other consumption related issues. So there are issues in the consumer's mind. So we are getting a little low mood that we received in the last quarter primarily also because of the fact that there was no festival or no season in that quarter. But we do foresee a better quarter coming from here because these are the festival quarters and the quarters which will pan out to be good.Sonia: You have considerable exposure to tier II and tier III towns, how do you anticipate business with the festive season on the anvil?A: Basically what we are seeing is tier II and tier III cities as we have already explained you that tier II and tier III has been fundamentally a very good market for us and primarily unexposed market and untapped market, these markets are primarily having a very high density of population. People want to buy or use more products and want to consume more.We still have a bullish approach on tier II and tier III cities. We still have a thought process that the consumers in a smaller town has the ability to spend more because still the consumption level has not been unlocked. So there is still a lot of unlocking to happen.The consumers are going to increase their market share. So in this coming quarter, we should be able to realise some good numbers and we have also opened up new stores in this month and we would continue opening some more stores in current month also.Latha: You have added another four stores in Q2, where does that take your total, what are your targets for the full financial year?A: As of now till September 30 we are operating in 109 stores across 92 cities but post that we have opened one more store in Orissa. We have entered in the state of Orissa. Till now we are operating in 12 states, 92-93 cities but now we are to expand more into two states which is Orissa and Bengal which we have launched. We have launched one more store in Bengal, another store we are going to launch within this week.Our store tally is 114 today, we will open maybe 8 more stores in this current quarter which will take our tally to 122 stores in 105 cities and we would be present in 14 states across more than million of sq ft. So we would be hitting the million sq ft number in this quarter. In the coming next quarter, we would once again target opening around three more stores which would take our tally to 125. So that is what we are targeting.What we primarily target is trying to bring in a regular growth, which would be something around 25 percent and this is the number we should aspire for and we believe that the newer store should add on to the growth numbers and also the SSSG -- we should be able to see little more positivity which has not been very good till now.So we expect it to be better but looking at the monsoon situation, things are not looking very bright but still we have belief on the youth population of India.