Jumbo Electronics, Dubai’s largest consumer electronics retailer, has decided to exit India due to mounting losses, and is in talks with Hotspot, the cellphone retail chain of Spice Mobility, to sell off its assets.
Jumbo, which has already informed its 145-odd staff in India to look for a change, will move out by March this year, shutting its 16 stores. A team from Dubai is undertaking the closure procedure.
The retailer, whose stores are located in the National Capital Region, Mumbai, Pune, Lucknow, Ghaziabad and Bengaluru, had also shut down a couple of stores in the past few years after failing to turn around the business.
Hotspot’s director Subhasish Mohantyconfirmed that the group had initiated talks with Jumbo and was keen to acquire the stores with its fixtures. “We are keen to acquire the stores with the fixtures since some of them are at prime properties,” he said, adding that the large stores at top locations will give Hotspot an edge over other retailers, as they will enable the company to showcase latest smartphones at a time when the market has become all the more competitive with the entry of several new Chinese brands.
Incidentally, Spice Mobility runs its own 200 Hotspot stores apart from managing another 225 stores of Univer Cellin the south and Mobility world in the north and the east.
With the parent company deciding to focus its resources on the profitable operations in West Asia, Jumbo had been planning to exit India for some time since it was unable to turn the business profitable, sources said, adding that after the demonetisation in November 2016, sales of white goods and cellphones were impacted all the more.
Reliance Retail is the largest player in the consumer electronics retailing. Other large corporate houses in this segment include Tataowned Croma, Spice, Essar’s The Mobile Store and several regional retail chains, such as Sangeetha and Poorvika. Mobiliti World had recently acquired UniverCell, but later entered into a management contract with Spice and may also sell the stores to the latter.
By Baishakhi Dutta
