Italian fashion and leather goods brand Gucci, part of the Gucci Group owned by French company PPR is bullish on its plans for India, which will see large investments towards refurbishing distribution networks.
As reported in the media, Gucci recently opened its largest store in Delhi and plans to open more new boutiques. Some of the investment will also be used for refurbishing the existing five stores.
Gucci is reportedly looking at its Indian business breaking even within three years. The Company has reportedly stated that they are working on several projects. Gucci has denied plans for 100% FDI in single brand retail in India, as it is deterred by the local sourcing clause. The luxury house is instead more interested in sourcing embroidery from Indian craftsmen for its global operations.
Gucci entered India in 2007 in a franchise agreement with the Murjani Group, but later entered into a 51:49 JV with Reena Wadhwa, wife of Ashok Wadhwa, CEO Ambit Group.
A joint study by YES Bank and ASSOCHAM has revealed that India’s luxury market at present is at $ 8.21 billion and is expected to touch $14.73 billion by 2015. Several global luxury giants have evinced interest in investing in India, but are deterred by the existing high import duties, and now the 30% mandatory local sourcing clause.