Raymond looks to open 30-40 stores in second half of this fiscal

Branded apparel retail giant Raymond is going to open 30-40 stores in the second half of current fiscal, says the group's Chief Financial Officer Sanjay Bahl. The company had shut 16 stores in Q2 of current fiscal.Bahl says the company also targets renovation of 150 stores.The company registered a healthy revenue growth of 12 percent but its margins dissapointed. Bahl says second half volumes and revenues will be better. He is also positive on the margins.The branded apparel business continues to post losses for Raymond. But Bahl says the company has a long term focus on branded business and is trying to build economies of scale in the business.Below is the verbatim transcript of Sanjay Bahl’s interview to Prashant Nair and Ekta Batra on CNBC-TV18.Ekta: Earnings before interest, taxes, depreciation and amortisation (EBITDA) margins were down almost 200 bps even though revenues were higher. Can you explain that to us?A: Given the fact that demand in the first half of the quarter was fairly muted and then it picked up due to the festive season and the marriage dates and also the rural pick up, which happened on the back of normal monsoons. So, we have registered an aggressive revenue growth of 12 percent at a topline level and bottom-line nearly tripled at the profit after tax (PAT) level to Rs 25 crore. So, this is a fairly good quarter for us.We have registered a revenue growth across all the SBU segments that we have. So, our textile grew by 12 percent, apparel business grew at an aggressive rate of 18 percent, garmenting grew at 18 percent, shirting business grew 14 percent and auto component, which has been a laggard in the past grew 24 percent. So, that has been a very positive factor for us in this quarter.Prashant: Could you talk to us about your margin expectation for the full year as the second half is expected to be a little better, right?A: Margins -- it will be difficult for me to give you a number to it but if you look at H1 and H2, H2 is a period when our volume growth is significantly better than H1 and also our realisations are better because of the onset of the winter the higher premium products are sold more. So a better realisation, so accordingly you see a shift in margins on the positive side.Ekta: Your tools and hardware segment continued to be an underperformer. Any plans to hive it off?A: We have to create value to unlock value. So, the focus is to achieve that. Achieve phase one of our strategy, is to create value and then we are certainly open to look at options to unlocking value.Prashant: Could you talk about the branded apparel segment, are you looking at bringing in an investor, what are your plans there?A: Right now our focus is to build this business, scale up this business. We are at a level of about Rs 1,300 crore. The focus as I said is on the four power brands. So, scale these businesses up, grow aggressively 20-25 percent per annum and this will see profitability improve in this business as well. So, no specific plans in getting in any investors but our focus is to build a brand and grow this portfolio. We see this as a very important part of the group portfolio and right now we are trying to build scale in this business.Ekta: What might your land development plans be for your Thane Parcel?A: Definitely we have shared this in the past and I would like to share with you is that we have now a dedicated real estate team, which is headed by a CEO who is an industry veteran and this team is now working on evaluating multiple options, which are open to us.In this business, there are number of regulatory approvals, which are required for the business and all this is currently in progress. What I am happy to share is that we have secured a labour NOC for the land development. That is just one of the important approvals that you need, there are others which are in the pipeline. So, the work is currently in progress. As and when we have something definitive to share we will certainly come back to you.