Oct. 12 (Bloomberg) -- Salvatore Ferragamo SpA, the Italian luxury-shoe maker that went public in June, plans to add stores in India as demand for luxury products in the world’s second- fastest growing major economy rises.
“There is huge opportunity, if you look at the size of the population, the age of the population, the number of high net- worth individuals,” Chief Executive Officer Michele Norsa said in New Delhi yesterday. “In terms of potential customers we have almost no limit.”
The company plans to add six stores in India in the next three to five years, Norsa said. The Florence, Italy-based maker of shoes, bags and apparel is tapping the country’s market for luxury products, which grew 29 percent to $2.04 billion in 2010, according to a report by A.T. Kearney and the Confederation of Indian Industry.
Salvatore Ferragamo signed a joint venture with India’s DLF Ltd. in 2008 to open stores in the world’s second-most populous nation. The company owns a 51 percent stake in Ferragamo Retail India Pvt., which operates the company’s four stores in India.
Indian laws limit foreign investment in single-brand retail to 51 percent. The government is “seriously” considering raising the bar on overseas investment in the industry, trade minister Anand Sharma said in a conference in New Delhi today.
Retail sales in India may almost double to $785 billion in 2015 from $396 billion this year, according to Business Monitor International estimates.
Asia represents 50 percent of Ferragamo’s business, Norsa said, speaking on the sidelines of the conference. China, Hong Kong, Taiwan and Macau are together the company’s largest market, surpassing the U.S., he said.
“We are opening 10-12 shops a year in China,” Paul M. Cadman, chief executive officer of Asia Pacific, said in interview. “We have the mechanisms to open 10-12 stores a year in India, but we need the right availability financially and we need the right infrastructure to be available also.”
Salvatore Ferragamo rose 1.3 percent to 10.59 euros at the close in Milan, the highest since Sept. 29. The company sold shares in an initial public offering at 9 euros each in June.
--Editors: Cecile Daurat, John Lear
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