What is the reason behind buying a loss-making, low-margin business?
There are synergies which make sense. We have turned around and added a lot of value in our previous acquisitions. Retail is all about sourcing and back-end operations. We have demonstrated that in the past.
You have been talking about building a large network of small stores. Then why did you acquire a hypermarket business?
In a large-store model, only a few have succeeded, but in small stores, there is a lot of activity. In large stores, scale is needed. We are keen to build small stores and are working on that direction. But we will grow both the formats. Small format will focus on food and large format will focus on multi products that require good sourcing and stronger distribution.
Will there be any financial burden on the company with the new acquisition?
There is a case of margin and sales expansion. Average sales per square feet at HyperCity is 33 per cent lower than Big Bazaar. There is 50 per cent growth possibility in HyperCity. If the business growth goes 50 per cent, profits will grow automatically.