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Financial Plans

  • IKEA plans to set up 25 stores in India through a wholly owned subsidiary, investing a total of  €1.5 billion in a 2 phase program. They plan to stay for at least 15 years.
  • In the first phase, €600 million will be invested. The second phase, the remaining  €900 million will be injected. As required by the Indian government, 30% of sourcing will be carried out from local small business.
  • The government also requires at least 50 per cent of the funds to be invested in ‘back-end’ infrastructure like processing, manufacturing, distribution, design improvement, warehouse, logistics, storage, etc.  Investment in rentals and land cost will not be counted.
  • According to a McKinsey, the commercial real estate prices in cities are on par with New York's. Costs of setting up a store in New Delhi (which has a seventh of Bangkok’s average spending power) are four-fold greater than in Bangkok
  • The Indian government has decided that IKEA will be prohibited from selling food and, oddly, from providing financing to its domestic suppliers
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