INTERVIEW-UPDATE 1-IKEA chief says sales up after slowdown

* IKEA CEO says business picking up in Q1 of 2009-10 year

* Says 2009-10 financial year starting better than expected

* Says group has gained market share in all markets

* Says sticking to plan to open 15 stores per year

* Aims to go "full speed ahead" in India if rules change

MALMO, Sweden, Oct 30 - The world's biggest furniture retailer IKEA has seen sales rebound in the past two months after weaker-than-planned revenues in its 2008-09 year that ended in August, its chief executive said on Friday. Mikael Ohlsson also told Reuters in an exclusive interview that IKEA, the Swedish group with 269 own stores in 25 countries, has gained market share in the downturn while demand has held up as people become more price aware.

"This economic situation is IKEA's home ground you could say," said Ohlsson, 51, who became CEO on September 1 after 30 years with the company where he started in the Linkoping, Sweden, store selling carpets at the end of the 1970s. "We have gained market shares in all markets," he said at IKEA's newest and second-biggest store, in Malmo, south Sweden.

"We grew last year and are growing now since the summer by more than we had expected," Ohlsson added. "We grew through the whole cycle, and now it's started to pick up even."

"It (the 2009-10 financial year) has started better than we had anticipated," Ohlsson said.

IKEA, known for low-price, self-assembly flat-packed furniture and owned by a foundation controlled by founder Ingvar Kamprad, does not disclose earnings, but publishes sales which grew 1.4 percent in 2008-09 to 21.5 billion euros ($31.87 billion). The year before, sales grew 7 percent.

Ohlsson said 2008-09 sales were "less than planned".

"We have continued to invest throughout the downturn, we have not changed one millimetre in our long-term plans in investing in new stores and so on," he added, but declined to say how much IKEA invests around the globe.

"We don't have to grow just to show a stock market ... for us it is more important to take care of what we have," Ohlsson said, adding that he could not imagine that IKEA would ever go public, though he said that was a question for the owners.

IKEA opened 15 new stores in its 2008-09 financial year, and it aims to grow at that pace for some time, Ohlsson said.

He declined to give same-store figures, but said: "It's more or less flat on a same-store basis, and there is variation between markets, but overall there is growth."

"What has happened is that we had planned bigger growth, and now we have steady growth also like-for-like," he said.

Ohlsson said that price pressures were not IKEA's problem.

"In IKEA, you get applause when you lower the price and problems when you raise the price," he said.

ECONOMIES OF SCALE

"We create 2,000 new articles a year from scratch -- we design them ourselves -- to build in cost savings in the production process, in the materials, in the design, in the distribution and in the sales phase," he said.

"Every year we try to find ways to lower our price to our customers," he said, calling that "part of IKEA's DNA."

He said IKEA has gained a size that gives it "enormous possibilities" on the production side to secure quality and squeeze costs.

"We are coming into a phase where the car industry and electronics industry have been for some time," he said. "This kind of highly efficient production requires a certain volume and high investments.

Ohlsson said there are few global players in home furnishings but some hypermarkets and do-it-yourself chains have gone international and have businesses overlapping with IKEA's.

INDIA HOPES

IKEA has had plans to enter India, but has held off because it does not want to bend to India's rules requiring that foreign businesses establish joint ventures with local partners.

Ohlsson said IKEA will be ready to go "full speed ahead" to open stores in India once the regulations are changed to let it to have full control of stores in that gigantic market. ($1=.6746 Euro)