Koutons’ president quits

Koutons the well known apparel retailer is surely going through some tough times.

The latest is that the President Balvinder Singh Ahluwalia has put in his papers. The apparel retailer reportedly has around Rs 660 crores debt on its books and is currently undergoing a corporate debt restructuring. In the last few months it has seen a spate of exits. In February this year, two of its directors -- Gurdarshan Singh Bhalla and Virender Kumar Gupta -- resigned. Last month, Arun Aggarwal, company secretary-cum-compliance officer, quit. The company’s chief financial officer, Ajay Mahajan, and company secretary Poonam Chahal had also left last year.

Koutons was launched in 1991 and became India's largest retail apparel chain in a span of 10 years. The company moved up the value chain from a garment manufacturer to a retailer by opening its own stores in 2002. By 2009, the company had around 1,400 exclusive brand outlets making it the largest apparel chain. But its strategy of deep discounting had its own pitfalls. Earlier this year, the debt-ridden retailer had appointed SBI Capital Markets to draft the debt recast scheme. Koutons is the second such financially-troubled major retailer to have gone for a CDR after Vishal Retail. Experts say the deep discounting model will work in a market like India as long as the firm is able to project the aspirational image.