Two marquee international brands, Giorgio Armani and Ferragamo, that have joint ventures with leading realty player DLF group’s subsidiary, DLF Brands, have been talking to other corporate groups and investors to scope out the potential of changing their Indian partner.
The foreign direct investment (FDI) regulations in the country permit 51 per cent investment in single-brand retail. This restriction has forced global luxury retailers to either enter into joint ventures with local companies or forge tie-ups with a group of Indian investors. Several global retailers, however, push for alliances of short durations with call options as they anticipate that the government will eventually allow 100 per cent foreign investment in single-brand retail.
Over the last five years, several leading luxury brands have already parted ways with the partner they chose to come to India with and have formed new alliances. Several have changed partners more than twice.