KOZHIKODE: The Lulu mall, set to commence operations in Kozhikode next month, is likely to face stiff competition from the existing malls and hypermarkets in the city, according to a leading rating agency.
“Kozhikode is not like Kochi or Thiruvananthapuram, which do not have established popular players big enough to compete with the Lulu brand,” said a top business analyst while speaking to businessbenchmark.news.
HiLite Mall is the highlight of Kozhikode’s mall space. HiLite is currently one of the largest shopping malls in Kerala and has a significant number of retail outlets, restaurants, entertainment options, and hypermarkets.
Nesto’s presence
HiLite houses the popular supermarket chain, Nesto, which has a strong presence in the GCC, and is also one of the fastest growing supermarket chains in the Gulf region.
HiLite is considered a major shopping destination in Kozhikode. Focus Mall, which is located in the heart of the city, is one of the first shopping malls in Kozhikode, and it still remains a favoured shopping destination in the city.
Kozhikode has other well-known malls and hypermarkets that include Blue Diamond, RP Mall, Gokulam Gatteria and Big Bazaar.
Blue Diamond and Gokulam Gatteria too have Nesto supermarkets operating from their mall premises.
Why Convention Centre?
One would certainly be wondering how come the Lulu mall that is nearing completion in Kozhikode is known as Lulu ‘Convention Centre’ Calicut Ltd (LCPL).
LCPL, which is promoted by Yusuf Ali and his brother, Ashraf Ali, was incorporated way back in December 2011, with an objective to develop and operate a Convention Centre and hotel.
However, after ten years, in FY21, the management changed its mind and decided to develop it as an organised retail space (mall), with a large part, 80 per cent, to be occupied by Lulu’s own establishments.
So, LCPL will have Lulu hypermarkets, fashion stores, and family entertainment, among others, and the remaining 20 per cent of the space will be leased out to third parties.
Opening by Sept 30
The shopping mall in Calicut is being constructed at a total cost of Rs355 crore to be funded by Rs266.25 crore of debt and Rs88.75 crore of promoter contribution, according to the financials details released by the rating agency.
The company has achieved 98 per cent physical progress as on May 31, 2024, and the operations are expected to commence on or before the Date of Commencement of Commercial operations (DCCO) of September 30, 2024.
As on May 31, 2024, the promoters have contributed Rs141.47 crore towards funding the project, which is more than the estimated amount of Rs88.75 crore.
As on May 31, 2024, LCPL has leased out 90 per cent of the leasable area to outside tenants, which include reputed fashion and merchandise brands.
Time overrun
Earlier, the project was proposed to become operational by December 2023.
However, there has been time overruns owing to delay in obtaining building approval from Kozhikode Municipal Corporation, which the company has now obtained in March 2024, according to sources.
