Godfrey Phillips, with the backing of the KK Modi group, is in discussions with major players in the retail industry such as Tata Trent, Reliance Retail, and Avenue Supermarts for the potential sale of its retail grocery chain, 24Seven, as reported by The Economic Times. The outcome of these negotiations hinges on the valuation of the business, indicating that the talks are ongoing with entities that exhibit clear synergies, as mentioned by sources familiar with the matter.
Established in 2005, 24Seven operates 145 stores across regions like the Delhi-National Capital Region, Punjab, and Hyderabad, offering a variety of grocery items, snacks, beverages, Colorbar beauty products from the Modi group, personal care items, and ready-to-eat food products in certain larger outlets. Despite facing cumulative losses, the growth potential in the grocery retail sector suggests that the 24Seven model could be expanded to include hyper-convenience grocery offerings, staples, general merchandise, and even small in-store cafes, according to sources cited in the ET report.
Godfrey Phillips India disclosed its intention to divest the loss-making 24Seven convenience chain through an exchange filing on April 12 following a thorough assessment of its retail business division. The conglomerate's retail business division, which reported Rs 396 crore in revenue for 2022-23, accounting for 9.3% of the company's total revenue, had a negative net worth due to accumulated losses as of March 31, 2023. The decision to exit the retail business division was based on a detailed review of the long-term performance, market conditions, stakeholders' feedback, and the company's overall business strategy.