After Indian online grocers BigBasket and Grofers have reported growth in revenue last week, Spencer’s and Future Retail have recently announced a decline in their income for October to December 2020.
Future Retail: revenue has been badly affected by the pandemic
Future Retail has reported 71% less revenue during the quarter of October to December 2020. Its income has dropped from INR51,932m (US$715m) during the same period last year to INR15,069m (US$207m). Despite lower expenses this quarter, it has still led to a net loss of INR8,469m (US$116m) as its operations continue to be affected by the coronavirus outbreak.
Legal battle with Amazon over Future Retail’s proposed deal with Reliance Retail
Future Retail has also shared that it filed a suit before the Delhi High Court. The retailer wants to stop Amazon from interfering with the proposed takeover of Reliance Retail of its US$3.4bn operations. Amazon purchased 49% of Future Coupons in 2019, with the intention and right to buy Future Retail after a few years. However, Future Retail has run short of cash when India went into lockdown in March. To cut its losses, Future Retail has agreed to be bought by Reliance, disrupting Amazon’s expansion plans in India and has prompted this legal battle.
Spencer’s Retail: 4% drop in Q3 revenue, but starting to recover
Spencer’s has also announced a reduction in its revenue for October to December 2020. It has fallen by 4% from INR6,998m (US$96m) during October to December 2019, to INR6,720m (US$93m). But compared with the earlier part of the year, the retailer is starting to see some signs of recovery following disruption caused by the pandemic. Sales from dairy and fresh produce are improving through rapid deliveries, while non-food sales have also reached 85% of pre-pandemic levels. Spencer’s has also added seven new stores during the quarter.