Foreign Investment Promotion Board (FIPB) has given a surprise nod to France's Hermes International to set shop in the country. However, Hermes has been allowed to do so only through a joint venture with domestic partner Khanna Speciality Retail and Distributors, in which the former will have a 51 percent stake.
Through the Rs 9-crore joint venture, Hermes plans to retail cosmetics, perfumes, readymade garments, leather goods, footwear, lifestyle products, jewellery, silk items and bags to tap the booming demand for premium luxury goods in India. Other products that Hermes can retail here are readymade garments for babies, pet items, enamel products, office accessories, saddlery and riding gear and outdoor accessories.
Hermes's entry into India comes at a time when FIPB is reviewing the policy on permitting foreign brands into India through the franchise route. Apart from retailing the French luxury brand in the Indian market, Hermes has also been allowed to carry out wholesale trading and distribution.
FIPB's clearance to Hermes is subject to the joint venture company sticking to norms laid down for single-brand retail. This means the joint venture can only retail the Hermes brand of products. Hermes-Khanna enterprise is also planning to open outlets in metros.
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