Pantaloon's debt pressure to reduce by June quarter

Future Group owner Kishore Biyani is preparing to make an

aggressive comeback with reduced debt pressure after demerger of its fashion business and sale of insurance business. According to the industry experts, Pantaloon Retail's total debt will come down to around Rs 2,000-Rs 2,500 crores by the end of June quarter post the completion of both the transactions.

Last year, Biyani sold majority stake in Pantaloon Retail to Aditya Birla Nuvo, which is about to conclude in the current quarter which will transfer debt of Rs 1,600 crores to the new entity. On the other hand, along with restructuring and realigning of the fashion business, he is also looking at introducing new brands and an e-commerce play with an aim of making his Future Lifestyle & Fashion a one billion dollars (over Rs 5,000 crores) unit by revenue within two years. The demerger and listing of fashion company Future Lifestyle Fashion will result in shifting another Rs 1,200 crores debt to the new company, which is likely to happen by June quarter. And the sale of insurance arm, which will reduce the debt by another Rs 800 crores may also get completed by the same quarter.

The company’s total debt stood at Rs 5,500 crores in the quarter ending December 31, 2012.