From a small diamond trading company to the country’s largest jewellery brand, the company has traversed a long way within a short span. This growth is propelled by Mehul Choksi, CMD of Gitanjali Group, through his foresight and inherent business sense. The saga goes on.

A little over four decades ago, in 1966, a small diamond trading company was born in Mumbai. The first step in a memorable journey had been taken.

Things developed rapidly over the years, with many milestones being passed on the way. The young company became one of the early De Beers Sightholders in India and by the early 1980s it had grown into one of the country’s leading diamond manufacturers and exporters.

That was when the second phase of the journey began, and it coincided with the entry of Gitanjali’s current CMD, Mehul Choksi. Not even out of college, the new head had a clear vision - the future lay in transforming the company into a major jewellery player, and he soon began guiding it in that direction, setting up a jewellery manufacturing unit in the fast developing Santacruz East Export Processing Zone, now simply known as SEEPZ.

India’s first branded jewellery line

But jewellery exports was not the only thing on the radar, and foreseeing that the Indian jewellery market, then massively dominated by plain gold ornaments, had enormous potential, Choksi began laying out his plans for entry into India.

Like many other things that the Gitanjali Group has done since then, the move towards turning this vision into a reality was as path-breaking as it was dramatic - the launch of India’s first branded jewellery line.

Research had indicated that the market was not yet ready for branded jewellery, that too a diamond studded line. But instincts suggested otherwise, and Gili (a combination of the first two and last two letters of Gitanjali) was born.

The newborn had a very difficult start - most traditional jewellers were eager to stock the products in their stores, but equally firm that it could not be under an independent branded counter. It was India’s first department store chain, the newly launched Shopper’s Stop, which found India’s first branded jewellery line to be the perfect partner for its needs.

There was no looking back from then, and the new course which was to build Gitanjali into one of the largest fully integrated diamond and jewellery manufacturers in the world had been decisively set. Fresh milestones were crossed, as D’damas was launched and Nakshatra, Asmi and Sangini were acquired. Other brands joined them and in no time there was a range of about 30 branded offerings with different types of jewellery at varied price points catering to virtually each and every consumer niche in the market.

Cut to early 2010. The Gitanjali Group has clearly established its position as a leading jewellery player, and most of the brands including Gili, Nakshatra, Asmi, D’Damas, Sangini, Diya, Maya Gold and others have all won for themselves a place in the consumer’s hearts. Gitanjali’s brands are easily the most visible jewellery brands in the Indian market today.

Quality, reliability and trust: the core value

But it is not only visibility that has made Gitanjali a household name among jewellery consumers in India. The company’s brands have also been known for unparalleled quality, reliability and trust, using certified diamonds and hallmarked gold, and being sold with a guarantee and different types of buyback offers.

Today, collectively, Gitanjali has an over 50 per cent market share of the overall organised jewellery market. Gili is the undisputed market leader in its segment and Nakshatra is one of the most popular and largest selling brands in the diamond jewellery category.

Growth track

Gitanjali is one of the key companies spearheading the growth in the organised jewellery sector which now accounts for about 4-5 per cent of the overall Rs 1,50,000 crore market and is growing at 30-35 per cent, i.e., significantly faster than the overall jewellery market.

The potential of the sector is, in fact, huge. Jewellery accounts for 27 per cent of the expenditure of the luxury consumer, the highest for any individual item in the luxury lifestyle bracket. The consumption of diamonds and diamond jewellery has also spurted, registering a 20-30 per cent growth for each of the first seven years of the new millennium, till it was marginally pegged back in 2008.

During this period, India has emerged as the fourth largest diamond consuming market in the world - just behind USA, Japan and Middle East, and the diamond jewellery market has grown from an insignificant figure to approximately between Rs 10,000 crore and Rs 15,000 crore.

Looking forward, a KPMG report “Vision 2015” projects that India and China together will emerge as a diamond jewellery market equivalent to US market (currently over 50 per cent of the global market) by 2015.

Today, Gitanjali is focused on driving further growth. It already has an entire range of jewellery brands, both Indian and foreign, across product lines and price points to appeal to different customer segments.

Venturing into luxury lifestyle segment

As one of the largest and fastest growing diamond and jewellery businesses in the world, with operations spread across the entire value chain from sourcing and processing rough diamonds to manufacturing, branding and retailing gold and diamond jewellery, it has strengths that few others can match. 

The current focus for aggressive expansion is the branding and retailing segment where existing initiatives cover plain gold and diamond studded jewellery brands for different occasions and varied consumer needs. There also are fashion brands, high end brands and brands at different intermediate price points.

Most recently, with the launch of its new multi-brand retail chain, Maya Fashion & Accessories, Gitanjali has further strengthened the integration of its jewellery business into the larger luxury lifestyle segment, as the new stores will be one stop locations for leading brands across categories like watches, perfumes, apparel, fashion accessories, etc. 

Providing unique franchising opportunities

Each jewellery brand, and each new retail category, translates into a unique franchising opportunity.

Gitanjali not only has the best known brands, but it’s aggressive and high profile marketing activity helps in driving further footfalls to the stores. As a result Gitanjali gives one the highest rate of returns among all diamond and gold jewellery brands, which translates into a win-win situation for the franchisee. Investment in the gems and jewellery industry is also an extremely safe step - the high value of the stocks is an asset in the hands of the business partner.

Introducing revenue sharing

Gitanjali is also the first player in the jewellery industry to introduce the concept of revenue sharing partnerships with property developers. This is mutually beneficial for both sides - with Gitanjali greatly expanding its retail presence and the developer finding a flagship brand to attract customers to the mall thus boosting up the levels of walk-ins.

Investors willing to take advantage of the lucrative opportunities in this sector thus need to look no further than the Gitanjali Group.

The role of franchising, the supports provided to a franchisee

Gitanjali

• Marketing, brand advertising support in national and regional electronic and print media
• Event based regular national and regional promotions schemes
• Operational and technical know how and support
• Facility planning and architectural designing of the store
• Periodical product and retailing skills training for staff
• Assistance in merchandise selection & trend analysis
• Local promotion schemes on joint sharing basis
• Providing products with third party certification

Franchisee

• Store fit out and branding to be done as per the Gitanjali norms
• An initial and average stock should be maintained as per the agreement
• Payment to be made as per agreement terms
• Goods to be sold at MRP
• A nominal franchising fee (as per brand structure)
• All local promotion schemes will be on joint sharing basis
• Bearing capital expenditures and ongoing operational expenditures
• Liberal exchange policy

Bouquet of Brands: Multiple Opportunities

Lucrative opportunities exist to set up EBOs or MBOs with India’s leading jewellery brands.

The biggest and most well known are

• Nakshatra - the most iconic of India’s jewellery brands; diamond jewellery that re-creates the mystery and brilliance of the stars
• Gili - India’s first jewellery brand; fine finished, machine-made, branded, diamond-studded, designer jewellery; suits every woman’s own temperament, beauty & personality.
• Asmi - for the New Age Indian woman, celebrating her new found economic and social independence
• Sangini - jewellery focused on relationships; for a special togetherness
• D’damas - a reason to celebrate every moment of life, always…
• Giantti - a luxury jewellery salon offering high-end Indian and international brands
• World of Solitaire - special solitaire jewellery that addresses every need of every age and celebrates the many milestones of life.
• Shuddhi - a JV between MMTC and Gitanjali; jewellery with purity that you can trust
• World of Silver - a retail outlet with an astonishing collection of exclusive international silverware.
• Lucera / Hoop -- jewellery with style, sophistication, and attitude. The perfect daily fashion accessory using a range of materials.
• Watches -- from the emotional world of high fashion, watches that combine technical precision with high design. With Italian flair and Swiss precision, these are sparkling luxury and fashion watches

Jewellery Retail in India: Opportunities Unlimited

Changing socio-economic factors in India have created a clear opportunity in lifestyle and luxury markets in India

• Number of High Net-worth Individuals (HNIs) in India, i.e., with income over $ 1 million are on the rise at a CAGR of 16 per cent
• Number of Indian tourists going abroad has increased at a CAGR of 17 per cent resulting in greater awareness about the various brands
• Consumption per capita in USD is rising at 4 per cent per annum with increased disposable income
• The rising number of working women with increasing fashion awareness is driving the higher spend on branded jewellery
• Changes in the retail environment are also creating an opportunity for establishment of modern retail formats
• The estimated $350 billion retail market is expected to grow by 13 per cent
• New retail concepts are changing the rapidly evolving organised retail landscape
• Deeper penetration of organised retail in Tier-II and Tier-III cities
• Organised retail market estimated at Rs 28,000 crore, i.e., 3 per cent of total retail pie
• More than 12 million retail outlets