Event update: Shoppers' Stop (Outperformer) - Senior level management changes…A new direction?
Event
Shoppers Stop (SHOP) has announced key managerial and board level changes.
Key details
- Mr Govind Shrikhande, Managing Director since 2010 and CEO from 2006, tendered his resignation. Mr Rajiv Suri, CEO since January 2018 has been elevated to the position of Managing Director for a period of 3 years. He has 25 years of strategic leadership experience across Europe, Middle East, Africa and Asia and prior to joining SHOP he was CEO of the Majid Al Futtaim fashion business which has close to 140 stores in the Middle East. Mr Shrikhande has moved on to pursue other interests and his personal commitments.
- Mr Chandru Raheja, non-Executive Promoter Chairman, has stepped down as Director and Chairman of the company given his age (77 years) and personal commitments. B.S Nagesh, a veteran of SHOP as well as current Non Executive Vice Chairman, has been elevated to the position of Non-Executive Chairman of the company.
- Ms Abanti Sankaranarayanan, Independent Director, has tendered her resignation and has been replaced by Ms Ameera Shah. Ms Sankaranarayanan is the current Chief Strategy and Corporate Officer at United Spirits. Ms Ameera Shah is the promoter and Managing Director of Metropolis Healthcare.
- Mr Karunakaran Mohanasundaram has been appointed as CFO. He replaces Sanjay Chakravarti who had moved on in January 2018. Vijay Jain vacates his position as Interim CFO. He has 25 years’ experience across retail, manufacturing and pharma industries. His last stint was as Executive Director Finance for the Asia Pacific region at Avon International, the largest direct selling beauty company in the world.
Our view
SHOP has struggled to keep pace with a rapidly changing retail environment and as a result has found it challenging to deliver competitive growth over the last 3 years. While it is too early to comment on the changes, we believe a change of guard could bring in a new direction which in turn could result in building momentum from a growth and profitability perspective. We will attempt to meet the two new senior management hires over the next couple of months to understand the change in strategic direction, if any. We currently maintain our Outperformer rating on the stock
Shoppers Stop Limited is a holding company. The Company is engaged in the business of retailing a range of household and consumer products through departmental stores. It operates through approximately 80 such departmental stores located in approximately 40 cities. Its products include apparels and non-apparels. Its non-apparel category includes cosmetics, personal accessories and leather goods, home wares, electronics, books and music. The Company, through its Website, Shoppersstop.com, offers international and national brands in men's, women's and kids apparel; gifts and fashion accessories, such as ladies watches, men's watches, artificial jewelry, fine jewelry, handbags, fragrances, men's and women's footwear, home furnishing and decor products. It has over six private brands namely STOP, Kashish, Life, Haute Curry, Velorio Fratini and Elliza Donatein. It offers First Citizen Loyalty Program for customers. Its application is available on Google Play Store and Apple App Store.
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