Kalyan Jewellers to continue its focus on studded jewellery, says MD

Talking to ET, T S Kalyanaraman, chairman & managing director, Kalyan Jewellers said “We tailor our showrooms to offer prominent displays of diamond and other studded jewellery and, in many cases, have entire floors dedicated to such jewellery. Furthermore, we have launched a number of sub-brands around our studded jewellery range.”

Kalyan Jewellers will continue to increase its focus on studded jewellery, including diamond jewellery, as these products have widened the consumer base to which it caters and also typically have a higher gross margin profile than its gold jewellery.

Talking to ET, T S Kalyanaraman, chairman & managing director, Kalyan Jewellers said “We tailor our showrooms to offer prominent displays of diamond and other studded jewellery and, in many cases, have entire floors dedicated to such jewellery. Furthermore, we have launched a number of sub-brands around our studded jewellery range.”

Indian jewellery consumers are also becoming increasingly brand conscious and developing greater sophistication in their jewellery preferences, according to a Technopak report. “Given this trend, we are continuing to explore opportunities to expand our range of sub-brands and to introduce new branded jewellery lines that are targeted at both specific customer niches as well as the luxury market focused on high-end gold and studded jewellery. Our revenue from sales of studded jewellery increased from 20.65% of our revenue from operations in FY2018 to 23.36% of revenue from operations in FY20,” he said.

He added that the We believe that the current growth of online jewellery retailing is driven by the affordable range of low-carat gold, studded and silver jewellery that caters to urban demand.

“At Kalyan Jewellers, in order to target a new generation of consumers, we have also started to invest in digital marketing and online sales, thereby communicating with the audience on their desired platform. However, wedding shoppers who usually make big-ticket purchases continue to prefer purchasing jewellery at offline retail stores,” Kalyanaraman said.

Kalyan Jewellers is coming up with an initial public offering of Rs 1,175-crore which will open for subscription on March 16, 2021, at a price band of Rs 86-87 per share of face value of Rs 10 each. The public issue will close for subscription on March 18, 2021.

Commenting about the hallmarking issue, Kalyanaraman said “Under-caratage has been a long-standing challenge for jewellery retailing in India and had provided an unfair advantage to many unorganized jewellery retailers who were not required to disclose purity standards. Compulsory hallmarking which will take effect from June 1, 2021 puts additional cost and process requirements on unorganized players and aims to address this issue. It will lead to a further shift of business from the unorganized to the organized jewellery segment.”

As a matter of fact, less than half of the gold jewellery sold in India is currently hallmarked. The new regulatory framework is evolving to ensure customers get fair value for their jewellery purchases.

”We send all our jewellery to government-approved hallmarking centres who analyse and check our jewellery in accordance with BIS norms, which are widely-accepted in the Indian jewellery industry. We have consistently set industry-level standards on customer experience, innovations and transparent pricing,” he said.

As of December 31, 2020, Kalyan Jewellers has 107 showrooms in India across 21 Indian states as well as 30 showrooms in the Middle East.

Commenting about the volatility in gold prices, Kalyanaraman said that gold price fluctuations are caused by many national and international factors, and in the life cycle of the brand, we have seen this often enough to realise that when it comes to shopping for jewellery, customers usually stick to their budgets.

Gold jewellery is a part of many of our customs and traditions, and shoppers plan for these gold purchases, keeping in mind their available budget. So, while they might advance or postpone their buying dates, they will eventually shop, he feels.

“Since resuming operations post covid lock-down, we have experienced a return of customer traffic to our showrooms and by July 2020 revenues generated from our showrooms in India that were open, were broadly in line with pre-COVID-19 levels. Furthermore, in the three months ending December 31, 2020, we generated revenues in our showrooms in India that were higher than pre-COVID-19 levels and the corresponding period in FY2019,” he said.

Courtesy: Economic Times