Madhumita Mookerji

Kolkata: Bata India, India’s largest shoe manufacturer, will invest about Rs 500 crore to set up 250 new stores and upgrade 60-80 existing ones. The investment will be funded through the company’s cash a ccruals.

“Now there are 1,200 outlets and we plan to set up 250 more in three years mostly on a franchisee basis,” chairman P M Sinha said on Thursday. Of these, 60 would be set up by December.

Most of the proposed stores will be company-owned. “In each store, we would be spending Rs 1.5 crore -Rs 2 crore on interior decoration alone,” Sinha said.

The shoe major will also focus on institutional sales in India, leveraging on its strong global technical expertise in this field. Defence, paramilitary, factory and construction workers will be the main target consumers.

As part of a recast, the Indian arm of the Toronto-based Bata Shoe Organization sold off its Hawai/Hawaina brand of chappals to Brazil’s Al Pragatas for Rs 3.8 crore.

“The small-scale sector is the biggest producer of Hawai chappals, selling at one-third the price of a branded pair. So, we were unable to compete and have decided to concentrate on other types of sandals,” Sinha said.

Efforts are being made to revive 74 cash-drain stores. Sinha said if revival efforts fail, these stores will eventually be closed down.

Bata is also in discussions to set up a five-star hotel, a hospital and a school on the 262-acre township development at Batanagar, Sinha said.

Meanwhile, Bata’s net profit for the year 2007 increased 18.15% to Rs 47.44 crore from Rs 40.15 crore in 2006. Gross turnover grew 12.1% to Rs 890.7 crore from Rs 794.8 crore.

The company proposed a dividend of 15% on equity shares with an additional 5% dividend to celebrate its platinum jubilee.

Source : DNA