Adidas files application with DIPP for setting up fully-owned stores in India

NEW DELHI: German sportswear major Adidas has filed an application with the Department of Industrial Policy & Promotion (DIPP) for setting up fully-owned flagship stores in the country. The move comes three years after the company’s US brand Reebok was forced to close all its stores in India following a Rs 870-crore accounting fraud.
Adidas Group’s chief financial officer Ranabir Mitra filed the application on July 13, according to the DIPP website.

"In keeping with our strong commitment to serving the Indian consumer, it is also our desire and strategic intent to bring to the country world-class large retail formats that currently exist in our global set up,” Adidas said in response to an ET query. "With this in mind, we have submitted our application to the Department of Industrial Policy & Promotion."

India had in January 2012 allowed 100 per cent foreign direct investment in single-brand retail but with riders, which include sourcing at least 30 per cent of the products sold from small and medium enterprises.

Adidas, which competes with the likes of Nike and Puma, already has stores in India through franchisees. The company entered India more than a decade ago and currently operates through 750 franchised stores.

Roland Auschel, member of executive board and head of global sales at Adidas Group, had in a May interview told ET that Adidas is looking to reach 1,000 stores in the next few years. Last year, US-based sportswear brand Nike had made a proposal to DIPP to set up fully-owned stores in India. The proposal was reportedly rejected by the department.