INDIA BUSINESS WORLD - JUNE 2006
THE MONTH THAT WAS...

FENDI SET FOR INDIA FORAY

  FENDI, the Italian luxury fashion brand from the Louis Vuitton Moet Hennessy (LVMH) stable, is set to enter India . Famous for its leather goods, Fendi will be acquiring 51% stake in little-known Mumbai-based Fun Fashion (FFI).

This would be among one of the first few FDI proposals in the Indian retail sector after the government approved 51% FDI in single brand retail trade. Recently, Moja Shoes, a franchisee of Nike, was also allowed to bring in FDI into the company, under the same rule.

Post deal, FFI will operate as a joint venture company between Chordia Fashion, promoters of FFI, and Fendi. Sources said initially, FFI will distribute the Fendi range of products through a store in Mumbai. The product categories will include ready-to-wear, bags, accessories, watches, jewellery and shoes. In the long term, the fashion brand hopes to expand its presence in India from Mumbai to other cities. It plans to invest € 5,000,000 in India over a period of five years.

Talking about luxury brand retailing, Vivek Kaul, associate director and head-retail & leisure advisory, Jones Lang Lasalle said, “Luxury brands are looking at five-star hotels and luxury retail destinations such as Emporio in Mumbai, and Fendi would be no different.”

Fendi specialises in designing, manufacturing, distributing and retailing of luxury good for both men and women. Founded in 1925, the Italian fashion label is famous for its selection of shoes and furs. As part of LVMH Moet Hennessy group, Fendi is headed by its creative director Karl Lagerfeld. The label has been viewed as being unprofitable internationally. Analysts estimate Fendi lost at least € 35 million last year but efforts are on from LVMH to invest in beefing up its stores network worldwide.