Mumbai, Oct. 6: After setting up more than 100 hypermarkets in India, Essar Steel — the country’s second largest private steel maker — is taking this distribution model overseas to countries in Africa and West Asia.

Essar Steel offers customers, especially small and medium business enterprises, the flexibility to pick up as little as one kilogramme of steel from these hypermarkets at an established price.

The company has recently set up one such hypermarket in Dubai and plans to expand the retail chain in the region. It has trained its sights on the African continent where it expects to sell small quantities of steel to entrepreneurs and small businesses.

The company declined to give details of its overseas plans such as which countries in Africa it planned to set up shop first and the number of retail outlets it expected to launch. It is quite likely that it may first choose to go to east Africa, said sources.

The Essar group is keen to expand in Africa and West Asia in other businesses as well.

In 2009, it bought a 50 per cent stake in a refinery in Mombasa, Kenya.

Essar Steel is enthused with how the concept of hypermarkets and smaller expressmarts — that are run by franchisees — has taken off in India.

The company said 30 per cent of its Rs 11,000-crore revenue came from these retail outlets.

It kicked off the concept in 2006 by setting up the first store at Gandhidham in Gujarat.

Now, it aims to have a hypermarket within every 200 km.

The hypermarkets stock and sell flat products, which include hot-rolled, cold- rolled and galvanised steel sheets and TMT bars.

The company hopes to set up 125 hypermarts and 650 expressmarts by the end of this fiscal.

It has launched 100 hypermarts and 419 expressmarts so far.

Recently, Essar Steel announced that it would invest $1 billion to run its Algoma steel plant in Canada to push the facility to operate at its full capacity of 4 million tonnes.

The Canadian steel plant was acquired in 2007 for $1.6 billion.

The company plans to increase production by 2014 to 14 million tonnes and is looking to boost the distribution of its enhanced capacities through ventures such as hypermarts and expressmarts.