Value Retailers Crowd Into UP, Bihar To Tap Rising Incomes, Mass Markets

(MENAFN- Live Mint)

Bengaluru: Bihar and Uttar Pradesh are emerging as a battleground for value retail chains, which are expanding their footprint to tap into the growing industrialization, rising incomes and large populations of these two states.

Value retailers such as V2 Retail Ltd, V-Mart Retail Ltd, Bazaar Style Retail Ltd, Vishal Mega Mart Ltd and City Kart are bolstering their presence across the two states, opening new stores to capture a larger share of the growing market.

Value retailers are retailers that sell essentials, household goods, and fashion at affordable prices, targeting mass-market consumers in smaller towns and cities.

“Bihar and Uttar Pradesh have a lot of cities and districts with huge populations. That is why these are the best battlegrounds or best places where one can experiment their model," said Lalit Agarwal, chief executive officer (CEO) of V-Mart, over a call with Mint.

Also Read | The biggest retailers are thriving in the tariff econom

V-Mart is a West Bengal-based company that has made the biggest bet among all value retailers on these two states. The company has a 510-store network across the country, with nearly half of them concentrated in Uttar Pradesh (158) and Bihar (72). In the past three years, of the 119 stores that the company added, 34 were opened in in UP and 16 in Bihar. The company divides its geographical spread into five zones-North, South, East, with UP and Bihar being zones in themselves.

“Now we are trying to put more into the same city. We are getting into the smaller towns, the talukas within districts. For example, Lucknow alone has 24 stores. That shows the potential," Agarwal told Mint.

While the company, set up in 2002, is now looking to increase its store count in states like Uttarakhand, Gujarat, Madhya Pradesh, Rajasthan, Tamil Nadu and Kerala, it will also continue to expand in UP and Bihar, Agarwal had said in a post analyst call dated 25 July 2025.

V2 Retail, which has grown at a faster pace in the last three years than its larger rival V-Mart, has also built a strong foothold in both the states. As of June 2025, the Delhi-based retailer has 38 stores in UP and 39 in Bihar, compared with just 24 and 26 stores, respectively, three years earlier. Together, the two states now account for 36% of V2's nationwide network of 216 outlets.

“We are expanding rapidly across high-performing clusters like UP, Bihar, Odisha, Jharkhand and now also entering Punjab, Bengal, Rajasthan and the South," Akash Agarwal, whole-time director at V2 Retail Ltd said in an analyst call on 28 May.

Also Read | Retail jobs roar back as hiring rebounds across Indi

City Kart is even more concentrated in the two states. Of its 146 stores across India, 64 are in UP and 57 in Bihar. That means more than 80% of its entire store base is located in just these two states, making it one of the most regionally focused value retailers in the country.

City Kart is a Gurgaon-based value retail chain that focuses on affordable fashion and lifestyle products for middle- and lower-income shoppers in tier-2 and tier-3 cities. It was founded in 2016 by siblings Sudhanshu, Rohit and Sunita Agarwal.

Vishal Mega Mart has nearly two-thirds of its 717 stores concentrated in the region, making Uttar Pradesh and Bihar crucial markets for the retailer. The company does not disclose state-wise figures.

Bazaar Style Retail is another value fashion retailer that has been steadily expanding in UP and Bihar. As of June, the company operates 25 stores in UP and 30 in Bihar, together making up almost a quarter of its 232 outlets nationwide. The retailer added eight new stores in these two states over the past year.

While explaining the company's strategy on store expansion, Shreyans Surana, the managing director of Bazaar Style Retail, said in an analyst call on 15 May that the company focuses on expanding in states adjoining the ones where it already operates.

“Right now the focus is majorly on UP and Jharkhand as a territory, I will say UP, Jharkhand and Bihar. And still there are a lot of stores that can be opened in these areas," he said.

Sandeep Abhange, research analyst, consumer and midcaps at LKP Securities, said that there has been a big shift in consumption happening in India with more and more rural population warming up to organized retail.

“Now most of this rural population, who once depended on unorganized players, are shifting to organized players in the market," he said.“When a consumer sees a Zudio, they'd want to enter and buy clothes from there as it is more or less the same price point, plus they give a better quality, and people prefer a Zudio over an unorganized player because of the whole shopping experience," he said.

Both Bihar and Uttar Pradesh have seen a steady rise in per capita income in recent years, translating into rising purchasing power. According to data from the Union ministry of statistics and programme implementation (MOSPI), Bihar's annual per capita income has risen from ₹47,498 in FY22 to ₹66,828 in FY24. Uttar Pradesh has seen similar momentum, with per capita income rising from ₹73,048 in FY22 to ₹1,07,468 in FY24.

Bigger players want to have their fair share of presence in Bihar and Uttar Pradesh as well. Avenue Supermarts Ltd, which runs the grocery chain DMart, recently made its entry into Uttar Pradesh by establishing its first store in Agra.

Neville Noronha, the CEO of the company, said in a post-analyst call on 30 July,“You will see some stores coming up in UP. We have already tied up a few firm deals in these states."

Also Read | Small-town sparkle lifts PN Gadgil, Senco Gold ambition

Tata group's Trent, which runs the value fashion retail chain Zudio, has also bolstered its presence in these two states, with about 59 and 14 stores in UP and Bihar, respectively.

Emails sent to Vishal Mega Mart, V2 Retail, DMart, City Kart and Trent did not elicit a response.

“UP and Bihar have the highest population density. About 26% of the population of India is in these two states. Any company, be it a DMart, V2 Retail or a V-Mart, would want to be present there," said Abhange.

The consumption story is also closely linked with macroeconomic factors.

“Monsoon has been favourable for the country in the last three years, and most of the population in Bihar and UP have agriculture as the main occupation. With a favourable monsoon, discretionary spending has increased, and these value retailers want to capture that wallet share. Rentals and employee costs are one of the major expenses for retailers, and both are low in these two states," said Pratik Prajapati, equity research analyst at Ambit.

MENAFN04092025007365015876ID1110015283