HotSpot to spend Rs 200 crore on expansion
Posted by telcobizpedia on May 17, 2009
17 May 2009, 1304 hrs IST, PTI
NEW DELHI: Spice Group’s mobile retailing arm HotSpot will spend Rs 200 crore this fiscal on acquisitions and expansion of its operations across the country, a company official said.
“We are looking at 1,200 stores by the end of this fiscal with focus on the smaller cities…The total capex for the fiscal is Rs 200 crore,” HotSpot CEO Sanjeev Mahajan said.
The company plans to almost double its number of stores from the present 614 to 1,200. The company has about 500 stores under its brand, while the rest still operate as Cellucom, a Dubai-based mobile retail chain which the Spice Group acquired earlier this year.
HotSpot is also examining the inorganic route to grow its business in India. “The time is opportune to acquire and grow business and we would definitely use the inorganic route to expand…We are talking to (various) companies and looking at firms with at least 200 stores,” Mahajan said.
The Spice Group firm would fund the expansion through internal accruals.
“Going ahead, the focus would be on value-added services like gaming and music as well as accessories… as the margins on handsets are slim,” Mahajan said, adding that the company would push content like movies and music.
Estimates put the Indian mobile handset market at about Rs 30,000 crore with most handsets being sold in the unorganised market. India has about 400 million mobile subscribers and the numbers are growing at about 9-10 million a month. Other players in the organised sector include The Mobile Store and Future Axiom Telecom.