Record high gold prices have not deterred the wealthy from investing in gold and buying ornaments in the second-largest gold buying country but the middle class is switching to lower-carat and lightweight jewellery.
Consumers are favouring chains over independent jewellers, shopping frequently, and spending more on gifts, Kalyan Jewellers’ Executive Director Ramesh Kalyanaraman said in an interview.
“The advantage of Kalyan today is we can grow across the country … We have a lot of markets to go and explore,” he said, forecasting that revenue would “easily” rise over 25% for the fiscal year that started on April 1.
The jeweller, which had 278 showrooms branded “Kalyan” and 73 stores under the more affordable “Candere” brand in India at March-end, plans to open shop at 160 new locations this fiscal year, with the additions split evenly between the two brands.
Its bigger rival Titan had more than a thousand jewellery stores in India at March-end, with roughly half of those under its flagship “Tanishq” brand. In three years, Kalyan Jewellers aims its “Kalyan” branded stores to catch up with Titan’s “Tanishq” count, the executive director said, but flagged that the rapid expansion would squeeze the group’s core earnings margin. For the year ending on March 31, Kalyan Jewellers reported a more than one-third rise in revenue to 250.5 billion rupees ($2.9 billion), helped by double-digit percentage same-store sales growth as it opened 136 stores in India.
Titan’s mainstay jewellery business saw a 21% increase in total income to 465.7 billion rupees for the fiscal year.
