New Delhi: Value retail store chain Citykart has recorded a revenue of Rs 560 crore in the fiscal year 2023 on the back of its affordable pricing and customer-centric and operational strategies, its founder and CEO, Sudhanshu Agarwal told ETRetail in an interview.
Launched in 2015, Citykart sells affordable fashion, home furnishings, general merchandise, toys, and other utility products for value-conscious customers.
Sharing his outlook, Agarwal said that the affordable retail chain is eyeing a revenue of close to Rs 700 crore in FY24. Commenting on profits he said that the brand is making about 8 per cent EBITA at the company level currently.
Citykart has its presence across tier 2, 3, and 4 cities and runs 93 stores pan India. Eastern Uttar Pradesh is the primary market for the retailer currently with 49 stores.
Over the next 3 years, the company plans to increase its store count to over 250, shared Agarwal. The brand sets a CAPEX of approximately Rs 2 crore for each store.
Over the last few years, the value retailing market has seen a boom in demand. Retailers are actively setting up big store formats as they seek to capture the share of India’s unorganized retail market by offering customers good quality products at affordable prices. Recently, V-Mart’s CMD, Lalit Agarwal, a market leader in the value retailing segment said that the company plans to add 65-70 stores this year.
Citykart does not sell online. Commenting on competition from online retailers such as Meesho and Snapdeal focused on the value segment, the chief executive said, “While online retail has become incredibly popular, given the convenience it offers, there is nothing that can surpass what offline retail provides, both for brands as well as consumers.”
He further highlighted that from a business perspective, offline retail plays a major role in directing consumer behavior, primarily in tier 2 and tier 3 cities.
In addition to store expansion, Citykart plans to ramp up its warehousing capabilities. Currently, the retail chain has one centralized warehouse in Gurugram which serves as a supply center for all its stores across the country.
“As we are looking at adding 25-30 stores every year, we want to have a warehouse equipped to supply the stock on time,” said Agarwal adding that the company will also invest significantly into adopting technology and integrating apps and tools to control and add efficiency to its stores.
While retailers continue to ramp up their presence in the country, it is noteworthy that the demand for mass products has been under pressure lately due to inflation. In addition to the food and grocery segment, apparel and footwear retailers have seen an impact on demand due to a rise in cotton prices and an increase in GST to 15 per cent for entry-level footwear.