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Why buying Metro India makes sense for Reliance Retail

The acquisition of Metro India will not just aid Reliance in deepening its operations and physical store footprint in India, it will also help it gain access to a wide network of outlets and retail and institutional buyers, and give it a strong supply channel

December 22, 2022 / 07:17 PM IST
Reliance Retail. (Representative image)

Reliance Retail. (Representative image)

The retail business in India is increasingly consolidating in favour of large entities like Reliance Retail Ventures Ltd which, with its acquisition of Metro Cash and Carry India Pvt. Ltd, has taken another step in expanding its footprint.

The subsidiary of Reliance Industries Ltd is already India’s largest brick-and-mortar retailer with over 16,600 stores, and has a strong wholesale unit.

Backed by a massive warehousing and distribution network, Reliance Retail’s rapid expansion has not only disrupted established entities in the organized retail market but also the business models of distributors.

The purchase of Metro Cash and Carry, the Indian unit of German wholesale retailer Metro AG, by the Isha Ambani company for Rs 2,850 crore, has to be seen in this context.