Not really a competition to Raj - this sentence from the article clinches it (for now) - "The retail reach would span all ofBig Bazaar's stores and 30 standalone FBB outlets. "Hypermarkets/supermarkets have 10 to 15 per cent sales coming from fashion but Big Bazaar gets 35 per cent of sales from fashion," Biyani says".
FBB stores will be in cities, competing with the likes of Reliance Trends. Tier II and Tier III is still virgin territory
The major moat for V-mart as I look at it are the learnings of supply chain logistics in tier-2 and tier-3 cities. We all know how roads are leading to some of these small time towns. Not easy for any player (all established players have experience in Tier 1 only, and none in Tier 2, much less Tier 3).
That being said, competition will come some where down the line, and V-mart has to fight it. Not like the business world is going to give you anything on a platter The hallmark of any great business is how they interplay their short term operations management and competition and also kick in long term growth opportunities. So far on V-mart, it's been good.
Currently, it's a bet on it market cap (350 cr) vs potential market size (anybody's guess how big that is!) and the mgmt's ability to exploit the gap (which so far, they have done well with prudent balance sheet mgmt).