Raj Jain, president of Wal-Mart India and managing director & CEO of Bharti Wal-Mart Pvt Ltd, the wholesale retail joint venture with the Bharti Group, has quit the company, according to a company statement issued on Wednesday. The firm did not give a reason for his departure and named Ramnik Narsey as the interim chief of the retail giant in India.
Wal-Mart has been facing headwinds over bribery allegations related to lobbying for FDI norms in retail in India. Although the government has allowed 51 per cent FDI in multi-brand retail last year, the company is also facing scrutiny over possible violation of the investment and other operational regulations in the sector.
In addition, Wal-Mart has struggled to expand its wholesale retail footprint in the country, partly due to high real estate costs. Besides running the wholesale retail chain, the JV was also the backend logistics partner for Easy Day outlets, owned by Bharti Group.
For Raj Jain, this marks yet another exit from the Indian arm of an American multinational within a decade. Jain joined Wal-Mart in Shanghai (China) as president of emerging markets for Wal-Mart International in 2006. He also spearheaded the company’s entry into India and relocated back to India in 2007 to head the JV with Bharti.
Prior to joining Wal-Mart, he was regional head (marketing & supply chain) for the Asia-Pacific at Whirlpool Corporation in Shanghai. He had moved to an overseas assignment for Whirlpool in 2004 after heading Whirlpool India. Whirlpool India Ltd, the public-listed arm of the white goods major, had sunk into losses during his stint in the wake of aggressive price competition from Korean brands LG and Samsung.
Jain started his career at Unilever as a management trainee and spent some 16 years at the FMCG firm in India and the UK before joining Whirlpool.
Narsey, who joined Wal-Mart last month, has been made the interim chief of the company in India.
“Ramnik brings significant management and leadership experience to the role,” said Scott Price, president and chief executive of Wal-Mart Asia. “We remain optimistic about our business in India and look forward to our future in India under Ramnik’s leadership,” he added.
Narsey is currently senior vice-president of Wal-Mart International. Prior to Wal-Mart, he served as the chairman and chief executive officer at Woolworths India.
Australian retail group Woolworths had a previous venture with the Tatas for the electronics retail chain Croma. But Tata Group’s privately held company Infiniti Retail, which runs the electronics retail chain under the brand Croma, had last year acquired Woolworths’ wholesale retail arm in India for Rs 204 crore. Woolworths Wholesale (India) Pvt Ltd, a wholly owned subsidiary of Woolworths Ltd, Australia, was a cash-and-carry wholesaler, supplying merchandise to Infiniti Retail.
Since foreign investment in multi-brand retail was not allowed in India until recently, the Tatas had struck a deal where Woolworths came in as a backend supplier for its Indian-owned front-end business. Woolworths exited the venture as part of its strategy to exit the electronics retail business. It also sold Dick Smith electronics retail chain, comprising some 325 outlets across Australia and New Zealand, to the private equity firm, Anchorage Capital Partners. The company had been looking to exit its electronics retail arm since early last year. Outside India, Woolworths’ retail presence spans across food & grocery, liquor, petrol and general merchandise, among others.
(Edited by Sanghamitra Mandal)
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