Business | Investment

Emke will invest Dh4.3b to expand retail chain

Emke Group, which operates the biggest hypermarket chain in the Middle East under the LuLu and Al Falah brands, is to invest Dh4.3 billion to expand its network of 75 supermarkets and hypermarkets to 100 within the next three years.

  • By Saifur Rahman, Business Editor
  • Published: 23:03 August 25, 2009
  • Gulf News

  • Image Credit: Gulf News Archive
  • The competition in the UAE's organised retail sector is gaining momentum despite the economic slump, as sales continue to rise. Lulu, Carrefour and Spinneys are clearly leading the market.
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Dubai: Emke Group, which operates the biggest hypermarket chain in the Middle East under the LuLu and Al Falah brands, is to invest Dh4.3 billion to expand its network of 75 supermarkets and hypermarkets to 100 within the next three years.

The company, which opened its 75th hypermarket this month in Al Ain, serves 350,000 shoppers per day.

Emke Group Managing Director Yusuffali M.A., whose retail chain controls roughly a third of the UAE's organised retail market, said his company is entering the lucrative Indian market by developing the biggest shopping mall in Kochi, Kerala, with more than two million square feet of retail area.

"Work has already started on the project and we expect the mall to open in July 2011,"'' he told Gulf News in an exclusive interview. "Following this, we will develop more malls across India gradually."

According to some industry reports, Emke Group controls about 32.5 per cent of the UAE's retail market, followed by French hypermarket chain Carrefour that has a 24 per cent share. The aggressive expansion is expected to boost its market share further.

The company, which has a footprint in 15 countries in Asia and Africa with interests in manufacturing, garments, trading and shipping, is also making a foray into Egypt by opening a store later this year and a hypermarket due to open in 2010.

Retail analyst Simon Thomas of UK-based Retail International, said, "Whatever its origins, it appears to be very successful.

"People always need to eat, thus food retailers such as supermarkets and hypermarkets with a substantial food and necessities offer are likely to suffer less than high-end retailers who rely more on discretional spending."

The company's total turnover exceeded Dh7.6 billion ($2.1 billion) last year, 40 per cent of which came from the UAE. His group employs 21,000 professionals, including more than 14,000 Indians, spread across the Gulf.

The current economic situation, he said, did not dampen sales.

"Despite the global econ-omic crisis, we have witnessed a growth in sales across our network of hypermarkets in the region. This year, we expect our turnover to exceed $2.5 billion [Dh9.1 billion] up from last year's $2.1 billion [Dh7.6 billion],"'' he said.

Yusuffali, a non-resident Indian, started his journey from Kerala with a humble beginning. He arrived in the UAE in 1973 and began as a small-time trader.

His big break came during the retail boom in the 1990s - a time when the UAE's retail sector witnessed a major change, with the traditional groceries and supermarkets yielding place to large neighbourhood stores and hypermarkets.

Sensing the shift, Yusuffali made the right move. While the entry of Continent (now Carrefour) in 1995 has changed the face or retail business in Dubai, Yusuffali, took charge of Abu Dhabi's retail sector by rolling out LuLu Hypermarket in Abu Dhabi.

Following a string of success in hypermarket retail, the company has ventured into mall development business by investing in Al Wahda Mall, Khalidia Mall, Al Raha Mall and Mazyad Mall. Last year, it has taken over the management of Madinat Zayed Shopping Centre in Abu Dhabi.

LuLu will manage Mushreef Mall in Abu Dhabi, which is going to house the one of the biggest and most modern perishable foods market in the region, and will replace the old Fish and Vegetable market. The project is being developed in association with Mubadala.

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