KUALA LUMPUR: Sports equipment and apparels chain store operator Al-Ikhsan Sports Sdn Bhd (Al-Ikhsan) is targeting 15%-18% annual sales growth under its three-year strategic expansion plan that starts this year.
CEO Vach Pillutla said sales grew 17.9% to RM330 mil last year from RM280 mil in 2018.
Despite stagnant growth in the global retail market, he expressed confidence that Al-Ikhsan would continue to record double-digit growth backed by its affordable prices, the opening of more stores and the introduction of new segmented concepts as well as a new website.
“Our commitment is to keep Malaysia fit and active by making sports affordable for all.
“We intend to open up to 14 stores annually in Peninsular Malaysia with concepts such as Football Republic and Sneakers Street, depending on the market and catchment, to match consumer demand,” he said.
Pillutla said Al-Ikhsan would launch a new e-commerce platform by end-February to offer a more convenient online shopping experience to customers in Malaysia and overseas.
The new platform is seen to contribute 5% to total sales over the three years from now, he added.
Established in 1993 by founder Ali Hassan Mohd Hassan, Al-Ikhsan is the 64th largest sports retailer in the world with 130 stores in Peninsular Malaysia.
It is partly owned by Ekuiti Nasional Bhd (Ekuinas) after the government-linked private equity firm acquired a 35% stake in July 2016 for RM68.6 mil.
Ali Hassan said the strategic partnership with Ekuinas has enabled Al-Ikhsan to become more competitive in the retail market, with a better inventory software system and operations management support.
“Ekuinas has helped us find new team members while consolidating our stores and improving the back-end processes.
“Ekuinas has done a professional job in setting up a strong foundation since our partnership began in 2017,” he said, adding that the company has no plan for any new partners.
Meanwhile, Ekuinas CEO Syed Yasir Arafat Syed Abd Kadir said providing a strong foundation was the main business plan to further grow Al-Ikhsan, resulting in a strong 30% market share in the multi-retailer segment.
Saying that Ekuinas had achieved more than break-even on its investment in Al-Ikhsan, he added: “From Ekuinas’ perspective, Al-Ikhsan has strong liquidity and sufficient cashflow to grow, with good inventory management.
“Hence, the company does not require additional capital injection to expand further.”
Ekuinas, according to him, is exploring options to further grow Al-Ikhsan including listing on Bursa Malaysia.
Al-Ikhsan has about 30 brands under its umbrella including Adidas, Nike and Puma. – Jan 28, 2020, Bernama