A

CPP Report
Titled

GLOBUS CORPORATION LIMITED

For fulfilling the requirement of the award of degree of BBA

Subject CPP (IMS-306)
Under the Supervision of
Mrs. Sangeeta M.
Assistant Professor
Submitted to:

Submitted by:

The Director

Ruchi Singh
Roll No.34
MBA (5Yr.) 3rd SEM.
RegistrationNo.14-UIM-27

Institute of Management Studies

Kurukshetra University, Kurukshetra
(October 2015)
1

DECLARATION

I hereby declare that the work entitled GLOBUS CORPORATION LIMITED submitted to "Mrs.
Sangeeta M." is a record of an original work done by us under the guidance of "Mrs. Sangeeta M." of
"Corporate Profile Presentation" subject of MBA 5 Yr in "Institute of Management Studies" and this
project work is submitted in the partial fulfilment of the requirement for award of MBA in management.
The result embodied in this project has not been submitted to any other institute for the award of any
degree.

Place: Kurukshetra

Signature:
..

Date: 23/10/2015

Ruchi Singh

ACKNOWLEDGEMENT

I feel immense pleasure to give the credit of my project work not only to one individual effort of all those
who concern with it. I want to thanks to all those individual who guided me to move on the track.
The project entitled GLOBUS CORPORATION LIMITED
I am gratefully indebted to Mrs. Sangeeta M. for providing me all the necessary help and requirement
guidelines for the completion of my project and also for the valuable time that he gave me from his
schedule.

RUCHI SINGH

CONTENTS
TOPIC

PAG NOS.

Chapter 1 Company Profile

1. Company Sector Retail Sector
2. Company Profile

8-9
10 - 16

Chapter 2 Hierarchy of Strategic Intent

1. Corporate Level
(a) Vission
(b) Mission

19
20

2. Business Level
(a) Business Definition
(b) Business Modal

21
22

3. Goals
4. Objectives

23
24

Chapter 3 Swot Analysis

1.
2.
3.
4.

Strengths
Weaknesses
Opportunities
Threats

26
27
28
29 - 32

Chapter 4 Porters Diamond

1. Porters Five Force Model

34 - 35

Chapter 5 Financial statement

1. Income Statement

37 - 40
4

2. Balance sheet
3. Ratios

41 - 42
43 - 45

Chapter 6 Latest News About the company

47 - 48

Bibliography

50

Appendices
Appendics 1 Balance Sheet

52- 53

Appendics 2 Profit and Loss

54 - 55

EXECUTIVE SUMMARY

Globus clothing store is a start up retail of mens, womens, and childrens clothing store specializing in
unique and dazzling clothing. This business is a casual urban wear, traditional clothing store run by Rajan
Raheja group founded in January 1998. Its first location (at 35,000 square foot store) opened in Indore in
June 1999, followed by two locations in Chennai. As of April 2012, the chain has 35 locations in 22 cities
in India. This store serves both youths and adults. The intent of Globus is to provide the community with
unique clothing.

The focus of the Globus has always been on understanding the psyche of the youth we look at what
would surprise them and make them happy and when they shop at Globus and find ways to attract them
back to store. Globus is a fashion hub for young and trendy Indian men and women, girls and boys
across 27 cities in India. Over the past 15 years Globus has made a mark with their affordable garments
and accessories targeted towards the 16 to 35 year olds; designed by their young fashion designers
working out of the GLOBUS DESIGN HUB the first large format fashion retailer to have such a facility
in the country, located in Mumbai.

The vision of Globus is to combine state of art of art international information technology. They are
rapidly expanding. It wants to establish Globus as synonym for young and trendy fashion and therefore
their target is to have an additional 100 fashion stores by the end of 2017. The mission of Globus is to
take fashion to deeper levels and in that process, to become the symbol of youth fashion in India. It aims
to create connections with the Indian youth through exciting product design, providing excellent store
experiences; and by adopting persuasive marketing techniques.
Globus launches their own clothing line, for e.g. F21 which is an accessible hi-fashion brand, offering
high-quality apparel. It is an edgy fashion brand which is designed to appeal to the more experimental and
adventurous consumers who seek cutting edge fashion.
The goal of globus is to Reaching a milestone of 100 stores by the end of 2017 and to increase the retail
business. To become a substantial part of every Indians wallet.
6

Chapter - 1

COMPANY PROFILE

COMPANY SECTOR Retail

RETAIL SECTOR
Retail is the process of selling consumer goods and/or services to customers through multiple channels
of distribution to earn a profit. Demand is created through diverse target markets and promotional tactics,
satisfying consumers' wants and needs through a lean supply chain. In the 2000s, an increasing amount of
retailing is done online using electronic payment and delivery via a courier or postal mail. Retailing
includes subordinated services, such as delivery. The term "retailer" is also applied where a service
provider services the needs of a large number of individuals, such as for the public. Shops may be on
residential streets, streets with few or no houses, or in a shopping mall. Shopping streets may be for
pedestrians only. Sometimes a shopping street has a partial or full roof to protect customers
from precipitation. Online retailing, a type of electronic commerce used for business-to-consumer (B2C)
transactions and mail order, are forms of non-shop retailing.

Shopping generally refers to the act of buying products. Sometimes this is done to obtain necessities such
as food and clothing; sometimes it is done as a recreational activity. Recreational shopping often involves
window shopping (just looking, not buying) and browsing and does not always result in a purchase.

Types of retail outlets

A marketplace is a location where goods and services are exchanged. The traditional market square is
a city square where traders set up stalls and buyers browse the stores. This kind of market is very old, and
countless such markets are still in operation around the whole world.

In some parts of the world, the retail business is still dominated by small family-run stores, but this
market is increasingly being taken over by large retail chains. Most of these stores are called high street
8

stores. Gradually high street stores are being re-grouped at single locations called malls. These are more
defined and planned spaces for retail stores and brands.

Global Top 10 Retailers

Worldwide Top Ten Retailers

Rank

Company

Country of Origin

2013 revenue ($US million)

Walmart

United States

$464,162

Tesco

United Kingdom

$120,052

Costco

United States

$105,156

Carrefour

France

$103,555

Kroger

United States

$96,751

Amazon.com

United States

$88,988

Lidl

Germany

$87,236

Metro AG

Germany

$85,832

The Home Depot

United States

$74,754

10

Aldi

Germany

$73,035

PROFILE

Type

Public

Founded

1998

Headquarters

Mumbai, India

Area served

India

Key people
Vice Chairman,

Akshay Raheja
Vinay Nadkarni -

Globus MD
and CEO

Globus is a retail clothing store chain, based in Mumbai, India. Its part of the Rajan Raheja Group. As of
April 2012, the chain has 35 locations in 22 cities in India.

Globus was founded in January 1998. Its first location (at 35,000 square foot store) opened in Indore in
June 1999, followed by two locations in Chennai. Its Mumbai flagship location opened in November
2001 followed by a upscale new outlet in New Delhi at South Extension II. Over a span of few years, the
Globus made its presence felt across Bangalore, Ghaziabad, Thane, Kanpur, Ahmadabad, Lucknow,
Ludhiana and many other cities. As of May 2008, the fashion retailer opened its 24 th store in Nagpur.
Being in expansion mode, it has plans to set up 130 to 135 new stores in 70 cities across the country. The
proposed expansion envisages an investment outlay of Rs. 800 crores. While, 35 of the proposed 130 plus
new stores are to be set up in metros and Tier I cities, 70 of them have been planned to come up in Tier II
cities (8,000 to 10,000 sq ft each). Rest 25 to 30 stores will be set up in smaller (Tier III) towns (6,000 to
8,000 sq ft each).

10

The chain was run by Ved Prakash Arya from its founding until March 2004. Currently, it is run by Vinay
Gajanan Nadkarni, who serves it as the Managing Director and CEO. Nadkarni, who took over from Arya
in 2004, opened the 36th store in February 2013.

As numerous designs and fabrics go in and go out of fashion every season, this lifestyle chain retailer
does not compromise on market research. Its focus has always been on understanding the psyche of the
youth we look at what would surprise them and make them happy and when they shop at Globus and
find ways to attract them back to store.

Globus is a fashion hub for young and trendy Indian men and women, girls and boys across 27 cities in
India. Over the past 15 years Globus has made a mark with their affordable garments and accessories
targeted towards the 16 to 35 year olds; designed by their young fashion designers working out of the
GLOBUS DESIGN HUB the first large format fashion retailer to have such a facility in the country,
located in Mumbai.

GLOBUS DESIGN HUB

Globus design hub is a creative workplace of the fashion retailer. As part of the strategy for being
established as a leading fashion apparel brand for young men and women, it has made investments in a
studio in Mumbai. Over 50 talented designers and product specialists forecast international fashion trends
and create the latest and trendiest merchandise which is exclusively available under the brands Globus
and F21 at their fashion stores. Globus is a complete fashion brand. It is the apparel brand as well as the
destination brand. Three words vibrant, individualistic and expressive which encapsulate the spirit of
the youth are associated with Globus.

11

Eye catching fashion F21 is an accessible hi-fashion brand, offering high quality apparel. It is designed to
appeal to more innovative consumers who seek cutting-edge fashion. Styling and fabric innovations help
F21 offer high-end fashion at prices which are affordable for the young consumers. It offers a wide range
in daily casual occasions to club wear and automatically drives the attention of customers. It has also
plans to become a formidable player in fashion footwear and lingerie.
Globus , earlier promoted by Soha Ali Khan, has Kareena Kapoor, as its new Brand Ambassador. She has
a sense of style, charisma, attitude and above all a pan India appeal. Kareena Kapoor is excited about the
assignment.

PRODUCT
F21 The iconic youth fashion brand in India.
1. Handbags from La Belle and Carlton.
2. Footwear from Enroute and Carlton London.
3. Accessories from Globus.
4. Kids wear from Daffodils, Lilliput, Barbie, Catmoss and Ruff.
5. Mens wear from Flying machine, Spykar, Indian Terrain, Provogue, US Polo, Pepe jeans, Mufti
and Proline.

PRICE
1. Affordable garments that are trendy and fashionable and keeps pace with the changing trends.
2. Starting range is around 500 Rs.
3. Price differs according to the line.

12

PLACE
1. More than 35 stores across 24 cities in India.
2. Cities such as Pune, Chennai, Mumbai, Kolkata, Nagpur, Indore, Varanasi, Jalandhar etc.

PROMOTION
1. Through Newspaper
2. Magazines
3. Hoardings
4. Fashion weeks
5. Kareena Kapoor endorsing the brand and also its summer, winter collections and sale.
6. Discounts are available according to the festive season.
7. Privilege Club
8. Privilege Cards Gold, Silver
9. Exclusive offers
10. Gift vouchers
11. Online shopping

PEOPLE
1. Dynamic and zealous workforce.
2. Staff highly trained.
13

3. Monthly MIS meetings (Management Information System).

4. Feedback to thosewho loses out on promotions.
5. Conduct exit interviews for those quitting job.

PROCESS
1. Brought in modern international technology and made heavy investments in acquiring the best,
tried and tested processes and procedures of operation.
2. State-of-the-art international IT, the highest quality of human resources and sustained financial
commitment.

PHYSICAL EVIDENCE
1. Store design : Friendly atmosphere
Great location
Good Interior Design
Excellent furniture and fixture
Lightening used (Floodlighting)
2. Ensures quality service to the customers.

EMPLOYEE STRUCTURE

14

DEDICATION OF EMPLOYEES

15

ACHIEVING CORPORATE TARGETS

1. They work through 3 seasons Summer, Autumn and Winter.

2. Designers prepare the collections 6 months in advance.
3. They build the organisation by following a succession plan for higher level posts, in case of
dropouts.

SALARY STRUCTURE

1. Ratio of highest to lowest is 1000:7

2. Employees not on profit sharing basis.
3. Lack of punctuality and attendance may lead to deduction in salary.

INTERACTION WITH EMPLOYEES

1. Monthly MIS meetings (Management Information System).

2. Cricket matches, Award ceremonies, Anniversaries, Monthly bdays.
3. At the sales department personal interaction with customers.
16

17

Chapter 2

HIERARCHY OF STRATEGIC INTENT

18

CORPORATE LEVEL
VISION
A vision statement defines the desired or intended future state of corporation. Vision is a long-term view;
it is the source of inspiration. It is how to make a difference to consumers, to the community, and to the
world. Vision is a dream forward looking, vision of a company or an organisation is the principles of its
own, the ultimate source of priorities, a determination of what makes it unique and a declaration of its
independence.
19

SOURCE OF PRIORITIES
The vision of Globus is to combine state of art of art international information technology, the highest
quality human resources and sustained financial commitment to realize the long term vision. They are
rapidly expanding. It wants to establish Globus as synonym for young and trendy fashion and therefore
their target is to have an additional 100 fashion stores by the end of 2017.
WHAT MAKES IT UNIQUE?
Globus emphasizes and values its consumers the most.. It lays stress on long term relations and thus
values each and everyone associated to them.
The focus of Globus is always on maintaining an edge in fashion and to keep sharpening their offerings.
Thus they try and adopt a process which is full of research and innovation that best serves the customers.
Example - Jeggings
DECLARATION OF ITS INDEPENDENCE
Globus sells its clothes giving the tagline FASHION FOR A CHANGING WORLD. Globus achieve
customer delight by offering quality products and services through a process of continuous innovation.
Globus believes on the saying, product gets the customer to your store the first time, but service ensures
he comes back again. Thus it ensures quality services to the customers.
The main vision of Globus is to become the most admired fashion retailer in India.
MISSION
Mission is a formal, brief, written statement objective of an organization or a team. The company's
mission statement tells why and for what objective the organization was formed, what services, goods and
tips it gives the public, and what its standards are. It must distinguish the business from all other people
and be stated clearly, be brief and basic so that it is understood by all (staff and customers).
In short mission of an organisation is says, What an organisation is? What it should be? What it will be?
20

The mission of Globus is to take fashion to deeper levels and in that process, to become the symbol of
youth fashion in India. It aims to create connections with the Indian youth through exciting product
design, providing excellent store experiences; and by adopting persuasive marketing techniques. Its entire
fashion range comprises of apparel for men, women, kids and accessories at amazing prices. It offers
wide range like wok wear, campus wear, club and lounge dressing and genres Western, Indian and mix-nmatch.
What Globus is?
Globus is a retail store or a fashion hub for the young and trendy men and women, girls and boys. Across
24 cities in India. Globus has affordable garments and accessories targeted towards the 16-35 year olds.
Designed by young fashion designers working out of the GLOBUS DESIGN HUB, Mumbai. Globus has
affordable garments that are trendy and fashionable and keeps pace with the changing trends.
What it should be?
The highest quality of human resources and sustained financial commitment to realize its long term
vision.
What it will be?
Globus stores Pvt. Ltd. was formed to contribute to the revolution sweeping the retail industry. Globus
promises to bring out a perceptible change in the apparel and lifestyle retailing is carried out.

BUSINESS LEVEL
BUSINESS DEFINITION

Globus is a brand and is mainly into clothing business. Globus launches their own clothing line, for e.g.
F21 which is an accessible hi-fashion brand, offering high-quality apparel. It is an edgy fashion brand
21

which is designed to appeal to the more experimental and adventurous consumers who seek cutting edge
fashion. It offers high end fashion at prices which are affordable to young consumers. Globus has their
own designers who work for them. The price varies according to the line.

Globus targets 18-25 years old boys and girls as the lot of this group very easily gets fascinated towards
new trends and newly launched brands. So, Globus at intervals launches their clothing line for these age
groups. Also 25-35 years old men and women as extended target since all want to look young. These age
groups i.e. 18-25 and 25-35 .

Globus has the option of online shopping and shipping and as an alternate has 25 stores across 14 cities
and towns in India. Globus has both the options available for their customers. The customers who find
online shopping convenient go for online shopping as online shopping nowadays is the dominant practice
about which every individual knows, and the one who finds going to store and want to get the surety of
cloth material and size goes to store. The stores of Globus has friendly atmosphere, are at great locations,
has good interior design, excellent furniture and fixture and ensures quality services which is also a
environmental friendly act.

The customer groups of Globus are men, women, girls and boys because it is a youth fashion brand as
well as stylish and trendy. At the same time the people associated with Globus are A class people i.e. the
rich people of the society as these are the people who can really afford the brands as the brands associated
with Globus are the really expensive ones so, a average income person cannot afford such expensive
clothes.

BUSINESS MODEL

Globus says that the heart of their business lies in the creative workplace of their organisation: Globus
Design Hub. It has been recently launched in July7 in Andheri, Mumbai and is in the nascent stages of

22

becoming the leading design talent floor. It is the most well-equipped design studio in India in current
times.

Globus staff works through 3 seasons Summer, Autumn, Winter. Designers prepare the collections 6
months in advance. The use of attractive taglines for their clothing line attracts the customer such as
FASHION FOR CHANGING WORLD and says the spirit of the youth can be captured with three ways :Vibrant, Maverick and Expressive. It adopts a process which is full of research.

Globus is a brand which is still growing and also updating different kinds of brands in its stores. It has
done with its introduction in its starting days by heavily promoting itself and is now trying to handle the
competition in the market.

Festival is the time when the sales of the apparels increases where every individual wants to buy clothes
for the auspicious occasions. So, the sale increases as compared to normal days. This is the time when the
income of the organisation increases and a profit is incurred.

GOALS

1. Reaching a milestone of 100 stores by the end of 2017.

23

2. The aim is to increase the retail business.

3. To become a substantial part of every Indians wallet.
4. To increase organised retail.

OBJECTIVES

1. To analyze how the mix influence the customer satisfaction level.

2. To determine the current status of Globus.
3. To study the satisfaction level of customers with regard of Globus.
24

4. To find out the buying behaviour of the customers coming into Globus.
5. To identify main competitors of Globus with regard to services.

25

Chapter 3

SWOT ANALYSIS

STRENGTHS
1.
2.
3.
4.
5.
6.
7.

A wide range of clothes are available and also at a affordable price.

Friendly and helpful staff.
Perfect store location.
Good customer service.
Good quality clothes.
Celebrity as Brand Ambassador.
Own clothing line.
26

8. Hired fashion designers who work only for Globus.

9. Has good management reputation.

WEAKNESSES
1. International brand clothes which are available at the stores are highly expensive.
2. Lack of promotions due to which customers are not attracted as well as not aware about the

3.
4.
5.
6.
7.
8.
9.

brand whether it exists or not.

Some staff lack knowledge about the brand.
No vernacular advertising.
Does not showcase low end apparel but advertises expensive clothes.
Less discounts offered.
Limited stock of a particular design.
Organisational security.
General perception.

27

OPPORTUNITIES
1. Emerging fashion trends of the youths and being a fashion retail chain of clothes helps in the
expansion of their apparel range and launching of similar clothes that the majority youth asks

2.

which also helps in store expansion.

No use of technology or any rocket science as its a fashion brand so the main focus is on the

3.
4.
5.
6.
7.

design, pattern and the trend which is in; so it serves as the opportunity.
Organised Retail.
Involving consumer preferences.
Looking at expansion.
In store experience improvements.
Population of country is growing where the scope of market is kept on increasing for retail sector.

THREATS
1. The number of threats and computer related incidents increased at a tremendous rate as the
number of locations and the amount of data kept increasing. Considering the threats involved in
running a critical infrastructure with a wide variety of users using the systems thats connected to
the Internet, the need was felt for a robust and secure IT infrastructure. Keeping in mind the
companys rapid growth rate and expansion plans, the aim of this implementation was to provide a
28

secure and robust infrastructure for Globus. Data security, scalability and flexibility were key
aspects of the implementation. A Sonic WALL 4060 UTM box was set up at the gateway and it
takes care of firewall, content filtering device, gateway antivirus, IPSec VPN appliance, spam
filter, Intrusion prevention system and anti-spyware duties.
2. Competition is one of the major threats in retail industry as every other store or brand comes up
with new ideas on how to increase its market value and make its brand a renowned one.
Following are the competitors of Globus: Spykar Lifestyles Pvt Ltd

Spykar Lifestyles Pvt Ltd (Spykar Lifestyles) which is engaged in the sale of apparels &
accessories under the brand name spykar was established in 1992. In 1994, it introduced
Hellums, a collection of cotton casual wear. Subsequently in 1996 Spykar Lifestyles
launched Forays that catered to the after office leisure wear segment. In 1999, the company
opened its first exclusive retail store in Hyderabad. Spykar Lifestyles offers an entire range
of products including denims, shirts, jackets, boxers, sweats, socks, pants, tops, T-shirts,
eyewear, belts, deodorants, junk jewellery, wallets among other products. Its products are
offered at more than 700 MBOs across the country, apart from large format stores like
Shoppers Stop, Globus, Lifestyle, Pantaloons, Pyramids, etc.
Pantaloons Fashion and Retail

Pantaloons Fashion & Retail Limited is an Indian premium clothing retail chain. The first
Pantaloons store was launched in Gariahat, Kolkata in 1997. As of November 2013, there
are 76 Pantaloons stores in 44 cities. Pantaloons were previously controlled by the Future
Group, but has now been taken over by Aditya Birla Nuvo Limited (ABNL). According to
the Brand Trust Report 2014, a study conducted by Trust Research Advisory, Pantaloons
29

featured among 100 most trusted brands in India. With a chain of 105 fashion stores across
40 cities and towns, Pantaloons is constantly extending its footprint into the rest of modern
India. It spans a retail space of 1.7 million square feet which is amongst the largest in
India. The Pantaloons Payback Green card, which is a unique loyalty programme, has been
designed exclusively for Pantaloons' customers to enhance customer experience. Presently
offered to over 4 million members, the programme entitles members to discounts, points
and special privileges at all Pantaloons stores. A pantaloon retails approximately 200
brands which comprise a mix of private labels, licensed brands and more in apparel and
accessories. Pantaloons offer a wide range of exclusive brands that cater to different
occasions for men, women and kids. These include Ajile, Chalk, Akkriti, Trishaa, Honey,
and Annabelle, san frasico jeans, mini klup, basics.
Shoppers Stop

Shoppers Stop is an Indian retailing company promoted by the K Raheja Corp Group,
started in the year 1991 with its first store in Andheri, Mumbai. Shoppers Stop Ltd has
been awarded "the Hall of Fame" and won "the Emerging Market Retailer of the Year
Award", by World Retail Congress at Barcelona, on April 10, 2008.] Shoppers Stop is
listed on the BSE. As of 2013, Shoppers Stop has 73 stores in India. Shoppers Stop began
by operating a chain of department stores under the name Shoppers Stop in India.
Shoppers Stop has 74 stores across 35 cities in India. Specifically, Shoppers Stop stores
retails clothing, accessories, handbags, shoes, jewellery, fragrances, cosmetics, health and
beauty products, home furnishing and decor products. Shoppers Stop launched its e-store
with delivery across major cities in India in 2008. The website retails all the products
available at Shoppers Stop stores, including apparel, cosmetics and accessories. Shoppers
Stop opened stores in Amritsar, Bhopal and Aurangabad. Shoppers Stop retails products of
domestic and international brands such as Louis Philippe, Pepe, Arrow, Biba Apparels,
Gini & Jony, Carbon, Corelle, Magppie, Nike, Reebok, Soulflower, LEGO, and Mattel.
Shoppers Stop retails merchandise under its own labels, such as STOP, Kashish, LIFE and
Vettorio Fratini, Elliza Donatein, Acropolis etc. The company also licensees for Austin
Reed (London), an international brand, whose men's and women's outerwear are retailed in
30

India exclusively through the chain. In October 2009, Shoppers Stop has bought the
license for merchandising Zoo zoo the brand mascot for Vodafone India.
Westside

Trent is the retail arm of the Tata group. Started in 1998, Trent operates Westside, one of
the many growing retail chains in India based in Mumbai, Maharashtra and Landmark,
a bookstore chain with Brick and mortar stores in various locations of India. In 1998 Tata
sold off their 50% stake in the cosmetic products company Lakm to HLL for Rs 200
Crore (approx. 45 million US$), and created Trent from the money it made through the
sale. All shareholders of Lakm were given different shares in Trent. Simone Tata, the
chairperson of Lakm, went on to head Trent. The reason behind the sale was that Simone
Tata saw a greater growth potential in retail, and believed that it would be much more
difficult for an Indian company to release new cosmetic products in a market that had
opened up to global companies.
The company has a turnover of Rs. 357.6 crores (FY 2005-2006) and currently operates
more than 90 stores in the major metros and mini metros of India. The company has retail
stores in 42 major Indian cities under the Westside brand. Trent also operates
the hypermarket Star Bazaar in 8 Indian cities. In Aug, 2005 Trent acquired a 76%
controlling stake in Landmark, a Chennai-based privately owned books and music retailer
and completed 100% acquisition in April 2008. Landmark currently has 16 stores.

3. Changing Government policies.

4. Unorganised retail.
5. Economic condition.
6. Competition from local retailers.
7. Margins of business reducing all the time.
31

8. International players looking for India.

Chapter 4

PORTERS DIAMOND
32

PORTERS FIVE FORCE MODEL

33

5 FORCES
Rivalry among the competitor

ANALYSIS

Reliance Retail, Aditya Birla Group, Vishal

Retail, Bharti and Walmart, etc.
34

Threat of entrants

FDI policy not favourable for international

players.
Economies

requirements for profitable operation).

High initial investments and fixed costs.
Cost advantages of existing players due to

of

scale

(minimum

size

experience curve effects of operation with

fully depreciated assets.

Scarcity of important

resources,

e.g.

qualified expert staff.

Bargaining power of supplier

The bargaining power of suppliers varies

depending upon the target section.

The unorganised sector has a dominant

position.
There are few players who have a slight
edge over others on account of being
established players and enjoying brand
distinction.

Bargaining power of buyers

Consumers are price sensitive.

Availability of more choice.

Threat of substitutes

Unorganised retail.

35

Chapter 5

FINANCIAL STATEMENT

Corporate Identification Number

U45200MH1992PTC066474

Company Name

GLOBUS STORES PRIVATE LIMITED

RoC

RoC-Mumbai
36

Registration Number

66474

Activity

Building of complete constructions or parts

thereof; civil engineering

Company Category

Company limited by shares

Company Sub Category

Indian Non-Government Company

Class of Company

Private Company

Authorised Capital (in Rs.)

1,350,000,000

Paid up capital (in Rs.)

1,330,000,000

Number of Members(Applicable only in

case of company without Share Capital)

Date of Incorporation

23 April 1992

37

Email ID

corporate@rraheja.com

Address 1

RAHEJAS CORNER OF MAIN AVENUE

& V.P.ROAD,

Address 2

SANTACRUZ (W),

City

MUMBAI- 400 054

State

Maharashtra

Country

INDIA

PIN

400052

Whether listed or not

Unlisted

Date of Last AGM

30 September 2014

Date of Balance sheet

31 March 2014

38

Income and Expenditure Account

(Rs crore)
Mar ' 15

Mar ' 14

Mar ' 13

Mar ' 12

Mar ' 11

Income
Operating income

0.15

1.39

2.27

22.75

23.16

Material consumed

0.15

2.80

6.70

23.30

21.59

Manufacturing expenses

0.10

0.05

0.07

0.08

0.08

Personnel expenses

0.34

0.48

0.35

0.25

0.26

2.99

0.61

0.64

0.33

0.38

3.58

3.94

7.75

23.95

22.32

-3.43

-2.55

-5.48

-1.20

0.84

0.01

0.01

2.03

0.01

-3.42

-2.54

-3.45

-1.19

0.84

0.06

0.04

0.63

0.48

0.36

Expenses

Selling expenses
Adminstrative expenses
Expenses capitalised
Cost of sales
Operating profit
Other recurring income
Adjusted PBDIT
Financial expenses

39

Mar ' 15
Depreciation

Mar ' 14

Mar ' 13

Mar ' 12

Mar ' 11

0.30

0.30

0.29

0.28

0.28

-3.78

-2.88

-4.37

-1.94

0.20

0.05

-1.26

-0.53

-0.05

0.14

-3.83

-1.62

-3.84

-1.89

0.05

Non recurring items

Other non cash adjustments

-3.83

-1.62

-3.84

-1.89

0.05

-11.02

-7.19

-5.56

-1.82

0.07

Equity dividend

Preference dividend

Dividend tax

-11.02

-7.19

-5.56

-1.82

0.07

Other write offs

Adjusted PBT
Tax charges
Adjusted PAT

Reported net profit

Earnigs before appropriation

Retained earnings

40

BALANCE SHEET
(Rs crore)
Mar '
15

Mar '
14

Mar '
13

Mar '
12

Mar ' 11

Sources of funds
Owner's fund
Equity share capital

12.75

12.75

12.75

12.75

12.75

Share application money

Preference share capital

-11.02

-7.19

-5.56

-1.72

0.17

3.60

3.60

3.58

3.29

3.01

5.33

9.16

10.77

14.32

15.93

6.59

6.59

6.53

6.50

6.50

4.62

4.32

4.02

3.74

3.46

Reserves & surplus

Loan funds
Secured loans
Unsecured loans
Total
Uses of funds
Fixed assets
Gross block
Less : revaluation reserve
Less : accumulated depreciation

41

Mar '
15

Net block

Mar '
14

Mar '
13

Mar '
12

Mar ' 11

1.97

2.27

2.51

2.76

3.04

Capital work-in-progress

Investments

Current assets, loans & advances

4.38

7.54

9.19

13.22

14.92

Less : current liabilities & provisions

1.02

0.64

0.93

1.66

2.03

Total net current assets

3.36

6.90

8.26

11.56

12.88

5.33

9.16

10.77

14.32

15.93

Book value of unquoted investments

Market value of quoted investments

14.83

5.31

2.73

3.96

14.73

638.59

638.59

638.59

638.59

638.59

Net current assets

Miscellaneous expenses not written

Total
Notes:

Contingent liabilities
Number of equity sharesoutstanding
(Lacs)

42

RATIOS
(Rs crore)
Mar '
Mar ' 15 14

Mar '
13

Mar '
12

Mar '
11

Per share ratios

Adjusted EPS (Rs)

-0.59

-0.25

-0.60

-0.29

0.01

Adjusted cash EPS (Rs)

-0.55

-0.20

-0.55

-0.25

0.05

Reported EPS (Rs)

-0.59

-0.25

-0.60

-0.29

0.01

Reported cash EPS (Rs)

-0.55

-0.20

-0.55

-0.25

0.05

-0.53

-0.39

-0.85

-0.18

0.13

Book value (excl rev res) per share EPS

(Rs)

0.27

0.87

1.13

1.73

2.02

Book value (incl rev res) per share EPS

(Rs)

0.27

0.87

1.13

1.73

2.02

Net operating income per share EPS (Rs)

0.02

0.21

0.35

3.56

3.63

2,237.95

-184.29

-241.15

-5.27

3.62

Dividend per share

Operating profit per share (Rs)

Free reserves per share EPS (Rs)

Profitability ratios

Operating margin (%)

43

Mar '
Mar ' 15 14

Mar '
13

Mar '
12

Mar '
11

Gross profit margin (%)

2,431.44

-205.83

-253.77

-6.50

2.39

Net profit margin (%)

2,502.97

-116.40

-89.29

-8.29

0.23

Adjusted cash margin (%)

2,216.30

-95.00

-82.62

-7.06

1.45

Adjusted return on net worth (%)

-221.19

-29.18

-53.46

-17.12

0.41

Reported return on net worth (%)

-221.19

-29.18

-53.46

-17.12

0.41

-69.66

-31.02

-34.69

-10.24

3.48

Long term debt / Equity

2.08

0.64

0.49

0.29

0.23

Total debt/equity

2.08

0.64

0.49

0.29

0.23

32.47

60.70

66.71

77.00

81.10

0.02

0.13

0.18

1.50

1.44

Current ratio

4.31

11.69

9.88

7.95

7.34

Current ratio (inc. st loans)

4.31

11.69

9.88

7.95

7.34

Quick ratio

2.19

8.06

6.99

4.02

3.66

10.00

1.30

3.72

3.26

Return on long term funds (%)

Leverage ratios

Owners fund as % of total source

Fixed assets turnover ratio
Liquidity ratios

Inventory turnover ratio

Payout ratios

44

Mar '
Mar ' 15 14

Mar '
13

Mar '
12

Mar '
11

Dividend payout ratio (net profit)

Dividend payout ratio (cash profit)

100.00

100.00

100.00

8.92

Financial charges coverage ratio

-55.89

-63.09

-5.47

-2.49

2.34

Fin. charges cov.ratio (post tax)

-56.79

-31.85

-4.63

-2.38

1.94

7.56

85.70

102.48

98.05

99.34

Selling cost Component

Exports as percent of total sales

Import comp. in raw mat. Consumed

0.31

0.23

0.21

0.17

0.16

10.75

10.75

10.75

10.75

10.75

Earning retention ratio

Cash earnings retention ratio
Coverage ratios
Adjusted cash flow time total debt

Component ratios
Material cost component (% earnings)

Long term assets / total Assets

Bonus component in equity capital (%)

45

Chapter 6

LATEST NEWS ABOUT THE COMPANY

46

1. Globus plans more stores for F21 brand

2. Chennai stores of Globus relaunched

Rajan Raheja group has relaunched its globus retail stores in chennai, with an in-house brand called
'globus' to focus on the 'youth' segment. the new look stores now present a strong range of garments
targeted at 'the young and young at heart' customers. "the change in the strategy was based on the
feedback from customers visiting the two and half year old chennai store," said mr ved prakash arya, ceo,
globus stores. he said that the company has been observing an increasing trend among its customers...

3. Globus bets on run of the mall

MUMBAI: The Rajan Raheja group-promoted apparel retail chain Globus, which currently runs a mix of
stand-alone stores as well as stores in malls, will sharpen focus on malls. The retail chain, which will
expand its network by adding another 152 stores over the next five years with a capital expenditure of Rs
800 crore, will set up most of these stores in malls itself. "Malls are locations which attract walk-ins. They
are places where people prefer to shop and so come in huge numbers.

4. Globus chief Arya quits, is COO of Pantaloon

MUMBAI: Ved Prakash Arya, the head of the Rajan Raheja-controlled retail chain, Globus, has quit to
join Pantaloon Retail (India) as chief operating officer (COO) in yet another sign of top-level employee
churn in the fast-growing Indian retail sector. Mr Arya will head Pantaloon's retail operations and the Big
Bazaar hypermarket chain. He will report to Pantaloon managing director Kishore Biyani. He was chosen
mainly for his expertise in setting up retail operations from scratch.

5. Pantaloons, Globus, Turtle and other retailers eye Bangladesh to cut costs

47

KOLKATA: With India allowing duty-free entry of Bangladesh textiles, retail giants like Pantaloons,
Globus and Turtle have started exploring opportunities in Bangladesh. While Pantaloons and Globus are
looking at sourcing textile from Bangladesh, Turtle is looking at setting up factories there. With such
sourcing in place, retailers would consider cutting down apparel prices by 10-15% which they expect
will..
6. Globus Stores forays into kids wear segment

KOLKATA: Globus Stores, the R Raheja Group-owned apparel retail arm, is planning to roll out a
specialty retail format for casual and club wear for its private label brand F21, and venture into kids wear
to shore up margins in the highly-competitive apparel retail market. The 213-crore company will set up
standalone F21 outlets in malls and shop-in-shops inside other apparel retailers. "The return on
investment from standalone F21 stores is expected to be much more since they would...

7. Globus to invest Rs 350 cr for retail expansion

NEW DELHI: Apparel retail chain Globus said it will invest Rs 350 crore for opening 74 new stores in
the next 30 months across India. "Seeing the growth in the organised retail industry, we have planned to
increase the number of outlets to 100 from the current 26 stores in the next two-and-a-half years. This can
entail an investment up to Rs 350 crore," Globus President Subhash Chhabra said on the sidelines of Pure
& Play Retail Summit here. The entire investment would be funded through internal accruals, he added.

8. HKs dairy farm in talks with Rahejas

MUMBAI: Hongkong-Based food and drugstore retailer Dairy Farm International, the erstwhile joint
venture partner of RPG Enterprises, is understood to have held discussions with Mumbai-based Rajan
Raheja group which owns the retail chain, Globus, to be its joint venture partner. The group had earlier
mandated DSP Merrill Lynch to find an Indian partner to buy RPG's 51% stake in the retail venture. It is
this stake, which the Rahejas may buy. Vinay Nadkarni, CEO of Globus Stores, said that there is no tie-up
between Globus and Dairy Farm International.
48

BIBLIOGRAPHY

49

www.articles.economictimes.indiatimes.com
www.globusstores.com
www.google.co.in
www.moneycontrol.com
www.money.rediff.com
www.wikipedia.org

50

APPENDICES

51

BALANCE SHEET

Annual results in brief

(Rs crore)
Mar ' 15

Mar ' 14

Mar ' 13

Mar ' 12

Mar ' 11

Sales

0.15

1.39

2.27

25.15

23.16

Operating profit

-3.43

-2.55

-5.48

0.92

0.83

Interest

0.06

0.04

0.63

0.47

0.35

Gross profit

-3.48

-2.59

-4.08

0.45

0.48

EPS (Rs)

-0.59

-0.45

-0.69

0.03

0.03

Annual results in details

Mar ' 15

Mar ' 14

Mar ' 13

Mar ' 12

Mar ' 11

Other income

0.01

2.03

Stock adjustment

0.14

1.61

4.37

1.31

-1.18

Raw material

2.18

8.92

Power and fuel

Employee expenses

0.33

0.48

0.21

0.26

0.25

Excise

52

Mar ' 15

Mar ' 14

Mar ' 13

Mar ' 12

Mar ' 11

Admin and selling expenses

Research and development expenses

Expenses capitalised

Other expenses

3.11

1.85

3.17

20.48

14.33

Provisions made

Depreciation

0.30

0.30

0.29

0.28

0.26

Taxation

0.01

Net profit / loss

-3.78

-2.88

-4.37

0.17

0.20

Extra ordinary item

Prior year adjustments

Equity capital

12.74

12.74

12.74

12.74

12.74

Equity dividend rate

Agg.of non-prom. shares (Lacs)

554.92

554.92

559.35

559.35

559.35

Agg.of non promotoholding (%)

86.90

86.90

87.59

87.59

87.59

OPM (%)

-2,238.69

-183.97

-241.15

3.64

3.60

GPM (%)

-2,183.19

-185.97

-94.84

1.80

2.07

NPM (%)

-2,368.95

-207.45

-101.51

0.67

0.88

53

PROFIT AND LOSS ACCOUNT

(Rs crore)
Mar ' 15

Mar ' 14

Mar ' 13

Mar ' 12

Mar ' 11

Income
Operating income

0.15

1.39

2.27

22.75

23.16

Material consumed

0.15

2.80

6.70

23.30

21.59

Manufacturing expenses

0.10

0.05

0.07

0.08

0.08

Personnel expenses

0.34

0.48

0.35

0.25

0.26

2.99

0.61

0.64

0.33

0.38

3.58

3.94

7.75

23.95

22.32

-3.43

-2.55

-5.48

-1.20

0.84

0.01

0.01

2.03

0.01

-3.42

-2.54

-3.45

-1.19

0.84

Financial expenses

0.06

0.04

0.63

0.48

0.36

Depreciation

0.30

0.30

0.29

0.28

0.28

Expenses

Selling expenses
Adminstrative expenses
Expenses capitalised
Cost of sales
Operating profit
Other recurring income
Adjusted PBDIT

Other write offs

54

Mar ' 15

Adjusted PBT

Mar ' 14

Mar ' 13

Mar ' 12

Mar ' 11

-3.78

-2.88

-4.37

-1.94

0.20

0.05

-1.26

-0.53

-0.05

0.14

-3.83

-1.62

-3.84

-1.89

0.05

Nonrecurring items

Other non cash adjustments

-3.83

-1.62

-3.84

-1.89

0.05

-11.02

-7.19

-5.56

-1.82

0.07

Equity dividend

Preference dividend

Dividend tax

-11.02

-7.19

-5.56

-1.82

0.07

Tax charges
Adjusted PAT

Reported net profit

Earnings before appropriation

Retained earnings

55