INDUSTRIAL ANALYSIS

The Indian Retail sector has come off age and has gone through major
transformation over the last decade with a noticeable shift towards organised
retailing. A T Kearney, a US Based global management consulting firm has
ranked India as the fourth most attractive nation for retail investment among 30
flourishing markets.

The retail market is expected to reach a whooping Rs. 47 lakh Crore by 201617, as it expands at a compounded annual growth rate of 15 per cent,
accordingly to the Yes Bank - Assoc ham study.

The retail market, (including organised and unorganised retail), was at Rs. 23
lakh Crore in 2011-12. According to the study, organised retail, that comprised
just seven per cent of the overall retail market in 2011-12, is expected to grow at
a CAGR of 24 per cent and attain 10.2 per cent share of the total retail sector by
2016-17.

In terms of sheer space, the organised retail supply in 2013 was about 4.7
million square feet (sq ft). This showed a 78 per cent increase over the total mall
supply of just 2.5 million sq ft in 2012.
Favourable demographics, increasing urbanisation, nuclearisation of families,
rising affluence amid consumers, growing preference for branded products and
higher aspirations are other factors which will drive retail consumption in
India, said DS Rawat, Assoc ham Secretary General.

Retail classification
Retail industry can be broadly classified into two categories namely- organised
and unorganised retail.

Organized retail - Organised traders/retailers, who are licensed for trading

activities and registered to pay taxes to the government.

Unorganized retail It consists of unauthorized small shops conventional Kirana shops, general stores, corner shops among various other
small retail outlets - but remain as the radiating force of Indian retail industry.

Market Dynamics

In the past few years, Indian Retail sector has seen tremendous growth in the
organised segment. Major domestic players have stepped into the retail arena
with long term, ambitious plans to expand their business across verticals,
cities and formats.

Companies like Tata, Reliance, Adani Enterprise and Bharti have been
investing considerably in the booming Indian Retail market. Along with
these giant retailers, a number of transnational brands have also entered into
the market to set up retail chains in close association with bigger Indian
companies.

High consumer spending over the years by the young population (more than
31% of the country is below 14 years) and sharp rise in disposable income
are driving the Indian organised retail sectors growth. Even Tier I & Tier II
cities and towns are witnessing a major shift in consumer preferences and
lifestyles, the result of which, they have emerged as attractive markets for
retailers to expand their presence.

The Indian retail sector is highly fragmented and the unorganised sector has
around 13 million retail outlets that account for around 95-96% of the total

Indian retail industry. However, going forward, the organised sectors growth
potential is expected to increase due to globalisation, high economic growth,
and improved lifestyle.

Although the growth potential in the sector is immense, there are obstacles
too, that could slow the pace of growth for new entrants. Rigid regulations,
high personnel costs, real estate costs, lack of basic infrastructure, and highly
competitive domestic retailer groups are some such challenges.

Key drivers of the Indian Retail Industry

Emergence of nuclear families

An increase in the double-income households trend

Large working population

Reasonable Real estate prices

Increase in disposable income and customer aspiration

Demand as well as increase in expenditure for luxury items

Growing preference for branded products and higher aspirations

Growing liberalization of the FDI policy in the past decade

Increasing urbanisation,

Rising affluence amid consumers

Bottlenecks

A long way to meet international standards

Lack of efficient supply-chain management

Lack of required retail space

No fixed consumption pattern

Shortage of trained manpower

Lack of proper infrastructure and distribution channel

Emerging sectors/trends in Indian retailing

Within retail, the emerging sectors would be food and grocery, apparel,
electronics, e-commerce, fashion and lifestyle.

Incorporation of technology in the organised retail segment has been

something to reckon with in the past few years. Use of computers for
merchandise planning and management, control of inventory costs and
supplies and replenishment of goods done electronically, internal store
billing, etc has changed the face of product retailing.

Online retail business is the next gen format which has high potential for
growth in the near future. After conquering physical stores, retailers are now
foraying into the domain of e-retailing. The retail industry is all set to test
waters over the online medium, by selling products through websites. Food
and grocery stores comprises the largest chunk of the Indian retail market.

An emerging trend in this segment is the virtual formats where customer

orders are taken online through web portals which are delivered at the door
step the very same day or the following day. This trend has been catching up
with most of the large sized retail chains that have their websites.

INTRODUCTION OF THE COMPANY

Reliance Digital is a consumer durables and information
technology concept from Reliance Retail. It is a subsidiary of
Reliance Retail, which is a wholly owned subsidiary of Reliance
Industries.
Reliance Digital, an electronic arm of Reliance Retail Ltd is one of
the largest chain of stores for consumer electronic appliances. Every
Reliance Digital Store provides a wide range of 150 brands for its
customers to choose from. The ambience of these stores and the
exiting range of products make shopping at Reliance Digital an
experience in itself. Reliance Digital provides its customers with the
best deals at the best price. Reliance ResQ, the technical support arm
of Reliance Digital provides an end to end solution and technical
support for leading brands.
Reliance Digital was established in the year 2006. Over the years
Reliance Digital has expanded and has opened many outlets in
different parts of the country.
Reliance Digital stores are located in major cities like Mumbai, Delhi,
Chennai, Bangalore etc. The stores are spread out over large areas and
hence customers have an ease of access while searching for their
desired product. The stores provide special experience zones which
allow customers to have a look and feel of the actual products before
buying it.

PRODUCT RANGE AT RELIANCE DIGITAL

COMPETITORS:-

1. Croma: -

Croma has been launched by Infiniti

Retail Limited, a 100% subsidiary of Tata Sons. It efficiently and
successfully runs Croma's retail operations in India. In addition,
one of the worldss leading retailers.
Croma is the nation's first large format specialist
retail chain for consumer electronics and durables with
successful expansion into Croma Zip stores, Croma Kiosk.

2. Next: - NEXT

Retail India Ltd. is Indias largest

electronics retail chain. Incorporated in 2003, NEXT specializes
in organized retailing of consumer electronics, small home
appliances and mobile phones. NEXT is a multi-brand, multiproduct retail chain which stocks an entire range of consumer
durables, right from Air-conditioners, FPDs (Flat Panel Displays),
CTVs, Washing Machines, Refrigerators, Microwaves, Home
Theatre Systems to STBs (Set Top Boxes), Mobile Phones,
Gaming Consoles, small home appliances and much more!
NEXT retails worlds most popular brands such as LG, Samsung,
Org, Sony, Electrolux, Kelvinator, Whirlpool, Onida, Philips,
Kenstar, Sansui and its own brand.

3. E-zone: -

Founded in 2002 E-zone is present

across India in the form of stand-alone stores as well as at
Group format stores such as Big Bazaar, Hometown and
Central. It houses the best of national and international
electronics brands for a range of product categories such as
Audio, Accessories, Communications, Computing, Home
Entertainment, Home and Kitchen Appliances, Imaging,
Personal Entertainment & Gaming.