The Loot closes all its stores

Multi-brand apparel chain The Loot is shutting all its shops soon. The company plans to shut all its stores within the next 10 days as it has failed to repay loans to lenders. Most of the Loot outlets have already shuttered down. The Loot was operating 145 outlets in 2010-11 in 82 cities.

Incorporated in 2003, the company had taken a loan of more than Rs 100 crores from 10 banks and non-banking financial companies. The State Bank of India was the main lender, having given a loan of about Rs 40 crores to the company. The company had also taken a loan from Sidbi but since the retailer defaulted on payments Sidbi filed for liquidation and the matter is in court. Typically, Sidbi offers loans to the tune of Rs 3 to Rs 5 crores and charges an interest of around 15 to 16 per cent. Apparently there are other lenders too who are trying to recover the money they had given to the retailer.

The company reported a total revenue of Rs 107 crores and a net profit of Rs 3 crores in FY10. It is now under liquidation. Unable to match the discounts or the convenience offered by e-retailers, smaller brick and mortar stores are left with no choice but to shut down.