Pantaloon Retail’s profit after tax for the third quarter of FY ’11 grew 26 per cent year-on-year. Revenue grew 17 per cent year-on-year and same store sales growth in the lifestyle format is 10 per cent year-on-year. But these figures show a drop comparable to the same period last year. However, IIFL Institutional Equities, a part of the IIFL Group, one of the leading players in the Indian financial services space, retains ‘Buy’ on Pantaloon Retail. The management attributed the slowdown in the lifestyle format to supply disruptions in the fashion segment caused by the hike in excise duty in March and steep increase in cotton prices, which necessitated price renegotiation with suppliers.
However, same store sales growth in the fourth quarter is expected to bounce back as 16 per cent price hikes have now been fully implemented and supply issues are behind. Pantaloon is likely to add 2.5 million sq. ft. in FY ’11 as against 1.8 million sq. ft. in FY ’10. This should result in higher growth in FY ’12 as the stores ramp-up. Pantaloon Retail is India’s leading retailer that operates multiple retail formats in both the value and lifestyle segment of the Indian consumer market. Headquartered in Mumbai, the company operates over 16 million sq. ft. of retail space, has over 1,000 stores across 73 cities in India and employs over 30,000 people