- 29 Jun 2022
- ICICIdirect Research
Reliance Retail, others look to acquire Indian wholesale operations of Metro AG
News: As per media reports, Reliance Retail, Thailand’s largest conglomerate Charoen Pokphand (CP) Group, and food and grocery online delivery platform Swiggy are in the race along with other private equity backed entities to buy the Indian cash-and-carry operations of German retailer ‘Metro’ AG. It is expecting valuations in the range of US$ 1.5-1.7 billion (~1.8x EV/Sales).
Views: Reliance Retail has been aggressively expanding its presence in the general trade segment by supplying groceries and fast moving consumer goods. If Reliance Retail is able to acquire Indian cash and carry wholesale operations of Metro AG, it will help boost the retail expansion plans that are already spread across modern retail, stocking up local kiranas and e-commerce grocery deliveries. Metro Cash & Carry India, which primarily serves the licensed retailers and traders in the country with groceries and other daily consumable items would help Reliance Retail further consolidate its backend supply chain. As on FY21, Metro India had revenues worth Rs 6910 crore with EBITDA margins around 4-5%.