Viveks puts expansion plan on hold

Chennai: Consumer durables retail chain Viveks has put off its Rs 100-crore expansion plan owing to the current slowdown.

The retail major was planning to expand its footprint with 50 new stores across cities in the South. It currently runs 54 stores under two brands — Viveks (26 outlets) and Jainsons (27).

“We have been planning to take the total number of stores to at least 100 by the end of 2009-10. However, due to the current slowdown we have decided to go ahead with the plan once the market stabilises,” said Mr B.A. Srinivasa, Joint Managing Director of the company.

According to him, during the current calendar year, the stores experienced slower growth over the previous year. Last year, there was an average growth of 25 per cent in the durables offtake. But this year, it is only 15 per cent so far, he said.

“Besides, real estate prices are also very high. We are expecting a correction in the next few months. Then we may consider carrying out our first phase of expansion,” Mr Srinivasa said.

Viveks was planning to fund the capex through internal accruals, infusion of additional equity and debt. It was also in talks with a couple of PE players for investments. “As of now, the talks are also put on hold,” he explained.