IKEA, a Swedish furniture giant, is likely offer more than it had promised five years ago. The global furnishing retailer is planning to invest in India more than it had promised earlier as it sees rapid growth in Indian retailing sector in the coming years. IKEA now plans to open over 40 stores across different formats as against 25 stores planned earlier.
The furniture giant had earlier announced plans to invest Rs 10,500 crore to open 25 stores by 2025. Now the company is planning to approach the Indian government for approval to pump in more Foreign Direct Investment (FDI). However, the company has not disclosed the timeline or the quantum of the additional investment. The company is revising its investment plan, taking into consideration the country’s economic growth and geographical dividend. One of the reasons for IKEA revising its investment plan is the increase in real estate prices in some parts of India.
IKEA is opening first store, in Hyderabad, almost five years after it received government approval in 2013 to invest Rs 10,500 crore in the country to open retail stores. IKEA’s next store would open in Mumbai next summer and this would be followed by stores in Bengaluru and Delhi.
Hyderabad store has come up over 13 acres in the heart of HITEC City, the information technology hub. The 400,000 sq ft. facility, which has come up with an investment of Rs 1,000 crore, houses the largest restaurant for IKEA anywhere, with a seating capacity of 1,000, serving Swedish and Indian dishes. The store will offer 7,500 affordable home furnishing products under one roof with more than 1,000 products priced under 200 rupees. IKEA has recruited 950 employees for the Hyderabad store and 50 per cent of them are women in tune with its policy. It plans to recruit 15,000 people in the country in the next few years.