The international brand Gucci has signed a new franchisee agreement with Ashok Wadhwa’s Luxury Goods Retail for its operations in Indian market. Earlier, Murjani Group, owned by Vijay Murjani had the franchisee rights for the for the foreign luxury brand. The joint venture is still in process and will have a 51:49 ownership stake, as Indian rules allow only 51% foreign investment in single-brand retail.
The reason behind the change seems to be the shift in the focus of Murjani from luxury to premium brands, which are doing well in the Indian market.
Luxury Goods Retail is owned by Reena Wadhwa (wife of Ashok Wadhwa) and she will be taking care of Gucci’s franchisee rights as well as three operational stores in Delhi and Mumbai bought from the Murjani Group.
“Gucci will control the majority stake in the JV and it will drive the day-to-day business in India,” said Ms Wadhwa, adding that this was her firm’s first partnership with any international brand and that the company is not looking at tie ups with other international brands at the moment.