te Tough times ahead for Redington Limited? Analysts decode why Apple products retailer may run into choppy waters | Zee Business

Tough times ahead for Redington Limited? Analysts decode why Apple products retailer may run into choppy waters

In January 2021, Apple CEO Tim Cook had said that the online store has received a tremendous response in India, and the company was ready to launch retail stores in the country.

Tough times ahead for Redington Limited? Analysts decode why Apple products retailer may run into choppy waters
Redington share price, Apple Inc, Apple products retailer, Anil Singhvi, Zee Business - Image Source: Pixabay

Redington share price: The road ahead for Redington Limited looks bumpy as Apple mulls opening its brand-owned stores in India. The development will lead to the Apple distributor and reseller facing cutthroat competition from the brand. Apple is reportedly set to open a 22,000-square-foot store in Mumbai this year, as per news agency IANS.

Redington, which has multiple business verticals, is a re-seller and dealer/distributor of Apple products. The company generates around 18 per cent of revenue from the mobility segment business, of which Apple contributes 27 per cent, Zee Business Research Analyst Ashish Chaturvedi said. In the distribution segment, the company has product categories of smartphones and wearables from global companies like Apple Inc, Google, Jabra, and Motorola, as per its website.

In January 2021, Apple CEO Tim Cook had said that the online store has received a tremendous response in India, and the company was ready to launch retail stores in the country in the future.

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According to the IANS report, at least five employees in Mumbai and New Delhi posted on LinkedIn that they have been hired for retail store operations.

Moreover, Tata Group also plans to open 100 stores across the country that will only sell Apple Inc products, Reuters had reported in December 2022. Entry of Tata Group in Apple products distribution may also have an adverse impact on Redington’s business, Chaturvedi further added.

Market expert Rakesh Bansal while speaking to Zee Business Managing Editor Anil Singhvi said that Apple sells its products online with hefty discounts, unlike other distributors and retailers. Besides, tech and smartphone manufacturers like Apple don’t take left-out inventory back from retailers/dealers.

From fast-moving consumer goods (FMCG) to pharma companies like ITC, Unilever, and Glaxo take back unsold products inventory from retailers, even if the products/medicines are past their expiration date, the market analyst stated, while explaining the problems faced by Redington in terms of inventory.

With smartphones and electronic manufacturers set to open their online as well as retail stores in India, this will add to the worries of dealers and distributors going forward, he added.

Shares of Redington Limited closed over 1.5 per cent higher to Rs 185.50 per share on the BSE as compared to 1.4 per cent rise in the S&P BSE Sensex.

 

Written By: Vaibhav Gautam Bansode
Edited By: Hemant Abhishek
Updated: Mon, Jan 09, 2023
10:00 pm
Mumbai, ZeeBiz WebDesk

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