To accommodate the increased demand, Reliance Retail, the country's top retailer and owner of historic British toy brand Hamleys and home-grown toy brand Rowan, has formed a joint venture with a Haryana-based firm for local manufacture.

To vertically integrate its toy business, the company has formed a joint venture with Sonipat, Haryana-based Circle E Retail.

"We also had a JV with Circle E retail for toy manufacturing for vertical integration for our toys retailing business," Reliance Retail CFO Dinesh Taluja said last week during an earnings call.

According to industry sources, the corporation is now working on a strategy to integrate processes from design to shelf.

Under this agreement, Reliance Retail would have complete control over the toy ecosystem, from design and manufacture to product distribution. This will also help Reliance gradually lessen its reliance on third-party producers.

According to the sources, this new business will cater to both of Reliance Retail's toy brands, Hamleys and Rowan. Furthermore, Reliance Retail is a prominent player in the B2B toy segment through Rowan.

An e-mail submitted to Reliance about the development went unanswered at the time the report was published.

Reliance Retail expanded its Rowan brand from B2B wholesale to the general retail sector last year. The plan was to use smaller store floors to enter the rapidly developing inexpensive branded toy industry.

In 2019, Reliance Retail acquired Hamleys, the world's oldest toy retailer. This was Reliance Retail's first acquisition of a global retail brand.

Reliance Retail Ventures Ltd (RRVL) is a significant toy distributor with both brands in its portfolio. Hamleys primarily operates in the luxury area, whereas Rowan's cheap offers target the mid-premium and mainstream markets.