Gitanjali Group

8/14/2019 Gitanjali Group.

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1. INTRODUCTIONFounded as a single company cutting and polishing diamonds for the

jewellery trade at Surat, Gujarat, in 1966, the Gitanjali Group became, many times

over, a pioneer among major diamond and jewellery houses.Gitanjali Group is one of the worlds largest integrated branded jewellery

manufacturer-retailer with an annual turnover of over $3billion. Established in

1966, today its acti vities are spread across the enti re value chain from rough

diamond sourcing, cutting, polishing and distributi on, jewellery manufacturing to

branding and retailing gold and diamond jewellery in India and abroad.The Group

pioneered the jewellery retail revoluti on in India by launching Gili way back in

1994. It today owns eight out of the top ten jewellery brands and distributes them

through its extensive network of own stores, shop-in-shops and franchise outlets

span across 300 citi es and 4,000 points of sale.

First major diamond and jewellery house to be launched and run by modern

entrepreneurs rather than dynastic jewellers. An authorised DTC Sightholder and

loyal customerand a modern multinational business run on innovative insights.

At the forefront of the global breakthrough in diamond jewellery design and

production brought about by Indias ability to cut diamonds considered

unworkable for jewellery till then. Has the distinction of producing the worlds

smallest heart shaped diamond (0.03 carat), and developing some 25 patented facet

patterns.

Besides changing the face of manufacture, broke the mould of traditional

jewellery marketing: it abandoned jewellery trade convention by launching

multiple brands for multiple markets and price segments.Opened up distribution

via superstores, department stores and other retail outlets at MRP,supported by

international certifications of scientifically tested purity and authenticity, across

India and in the worlds jewellery capitals. Even markets branded jewellery

directly by mail order catalogue.

Business model now integrates all operations, from rough diamond sourcing,

cutting, polishing and distribution, and jewellery manufacture, to jewellery

branding and retail, as well as global lifestyle brands, in India and abroad.


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Brought diamonds within reach of a wide consumer base. The first to offer

diamond studded jewellery at affordable prices, of standardised designs, quality

and pricing across locationsprogressively precision-producing replicable designs

using the latest CAD and CAM processes and equipment.

Offers jewellery in diverse styles: traditional, international classic, and

casual. For consumers of all age groups, tastes and budgets. With a growing

hamper of brands, some already global, and each targeted to specific consumer and

market segments.Having won over 50 awards from the Ministry of Commerce,

India for outstanding exports of diamond and jewellery, is today over $3000

million multinational group, and a publicly listed entity. Operations span the globe,

all the way from USA, UK, Belgium, Italy and the Middle East to Thailand, South

East Asia China, and Japan.

Values

Integrity, Solidarity, Credibility and Perfectionthese are the fundamentals of

Gitanjali's working philosophy as it impacts business and employee relations,

transparency of operations and quality assurance, on the way to creating a globally

valued organization. These are values painstakingly nurtured and demonstrably

proven over 40 years. We live and breathe them.

Vision

To be the worlds leading manufacturer of diamonds and retailer of branded

jewellery, with a strong, globally diversified infrastructure and integrated

operations efficiently linking diamonds from rough to retail.

Mission

To develop, produce and sell high quality jewellery and accessories worldwide

and help our customers to

get the maximum value for money.

To create incremental demand for diamonds through marketing and promotion

strategies.


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To create incremental enterprise and brand value to increase the net worth of the

group

To build in-house resources of unsurpassable skill in design, manufacture and

customer response. To protect worker interest and nurture professional growthand to remain a loyal

business partner to DTC.

THE BUSINESS MODEL

Gitanjali is a multi-faceted global organization that operates through an integrated

business model spanning the value chain in its entirety. Its activities range from the

cutting and polishing of diamonds,the design, manufacture and branding of

jewellery through to jewellery distribution and retail. It is aunique model. Thismodel allows for complete operational control over all upstream and downstream

activities.Gitanjalis organizational structure also sets it apart from family-owned

businesses that throng the jewellery space.Professionalism is at the heart of this

organization which is structured so as to be able to respond to market opportunities

more rapidly than others.

KEY INDIAN BRANDS

The Group is the pioneer of branded jewellery in India. Its several well-established

brands are positioned strategically to tap the rapidly growing branded jewellery

market in India as well as

other countries. The Groups portfolio comprises of key brands such as

Nakshatra, Gili, Asmi, and DDamas. These major brands are supported

by supplementary brands such as Maya, Diya and Sangini to name a few.

The Group has also launched new brands such as Amore and GDivas in

India as part of its constant endeavour to extend its product range thereby,rapidly filling gaps and addressing an ever-growing demand for branded

jewellery in India.

GILI

Gili jewellery is high quality, fine finished, machine-made, branded,


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diamond-studded, designer jewellery including pendants,earrings, rings and

bracelets in 18k gold studded with small, well-cut,good quality diamonds, as

matching sets or by themselves.The average sale price is aroundRs.15, 000

NAKSHATRANakshatra is a circular cluster comprising six to nine stones, with the central stone

larger than the stones surrounding it, signifying a constellation. It is a modern,

fashionable rendition of thetraditional seven-stone Thodu andthe Kuda Jodi

jewellery, which are traditional Indian floral designs. The combination of

traditional charisma and contemporary style helped it gain acceptance with women

across age groups.

ASMIThe design styling for the Asmi jewellery has always been that of curvilinear forms

around a central stone of and above 5 points. It rightly personifies the woman of

today and her inner fire. Asmi has under its patronage a range of distinctive,

contemporary yet affordable designs in diamond jewellery.

DDMAS

Ddamas has multiple sub-brands, each unique in positioning &offering. The brand

also has itemsin all categories-rings, earrings, nose pins, pendant, bangles,

bracelets, necklaces, Tanmanya, Mangalsutra , half sets and full sets. Each sub-

brand under D'damas offers stylized and contemporary designs, conceptualized and

created by an in-house team of award winning designers. Ddamasis perhaps the

only jewellery brand that has offerings in virtually all product categories, across all

price points, for all occasions and emotions, thus covering consumers across age-

groups and demographic classes

2. HISTORY

Founded as a single company cutting and polishing diamonds for the Jewellery

trade at Surat, Gujarat, in 1966 headed by Mr. Mehul Choksi.


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Incorporated on August 21, 1986 as a private limited company and subsequently

converted into Gitanjali Gems Limited. One of largest manufacturer and retailer of

diamonds and Jewellery in India. Operations included sourcing of rough diamonds

from primary and secondary source suppliers in the international market, cutting

and polishing the rough diamonds for exports to international markets and themanufacture and sale of diamond and other Jewellery through retail operations in

India as well as in international markets.

Gems & jewellery industry

One of the fastest growing segments in the Indian economy with an annualgrowth rate of approximately 15 percent.

The current market size of the Indian Gem & Jewellery Industry is US$ 25Billion

Total export of gems & jewellery in the year April-March,2010 was29081.11 with a 2.36% growth rate & 16.27% share in the total export.

The domestic market was guessed to be approximately USD16.1 billion infinancial year 2009.

Consumes nearly 800 tonnes of gold that accounts for 20 percent of worldgold consumption, of which nearly 600 tonnes go into making jewellery

India's strength lies in the 2 million highly skilled workforces in the countryin the gem & jewellery sector, out of which 1 million are exclusively

engaged in export production.

The Gem & Jewellery Industry has started showing positive signs of revivaland growth.


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Diamonds industry

Largest diamond cutting and polishing centre in the worldwith 60 per cent

value share, 82 per cent carat share and 95 per cent share of the world market in

terms of number of pieces. In the period of 9 months from April to December09exports of rough diamond declined by 37% to 157.09 lakh carats whereas the

exports of cut & polished diamonds mounted by 18% to 407.36 lakh carats .Nearly

9 out of 10 diamonds sold worldwide are cut and polished in India.Exported cut

and polished diamonds worth US$ 14.18 billion in 2007-08.

Manufactures diamonds of all cuts, shapes and sizes of all varieties like round,

princess, baguettes and all fancy cuts.Has democratized Diamonds by mastering

the art of cutting near gem quality diamond.

BUSINESS REVIEW

1. DIAMOND AND JEWELLERY MANUFACTURING SEGMENTThe company is engaged in the diamond and jewellery manufacturing.It is present

in the entire process right from sourcing rough diamonds, cutting and polishing

them to manufacturing jewellery.The diamond cutting and polishing process is

labour-intensive and requires specialised skills.Rough (uncut and

unpolished)diamonds acquired are sorted or graded on the basis of colour, shape,clarity, cut and weight. In order to ensure optimum recovery of polished stones

from the rough diamonds, the cutting process is carefully planned. The key steps in

the process are Marking, Cleaving,Sawing, Cutting and Polishing. The final stages

of the diamond manufacturing process consists of checking for damage, cleaning

by boiling in various acids and the final sorting before marketing to the

customer.The branded jewellery that the company manufactures includes diamond

studded and other precious metal jewellery. There are currently over 200,000active

SKUs. The company has produced branded jewellery in India for approximately 20

years. It started as an outsourcing partner for leading international jewellery brands

and then transitioned to cater to its own branded jewellery,distribution and

retailing.The majority of the branded jewellery that is produced in-house is used in

the companys own distribution and retailing network. The company makes use of

sophisticated jewellery manufacturing facilities in India that incorporate CAD

(Computer Aided Designing) and CAM (Computer Aided Manufacturing)


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technology, that is overseen by a highly skilled design team. The multiple

manufacturing locations mitigate risks associated with a single site manufacturing

facility. In addition, the company is situated in strategic locations to take advantage

of the supply of skilled labourers that may be specific to a region. Our

manufacturing facilities are also located at logistical hubs for efficient supply chainmanagement beginning with raw material sourcing and ending with easier access

to consumers..

2. BRANDED JEWELLERY AND RETAIL SEGMENTThe company believes that it has been a pioneer in the branded jewellery segment

and is amongst the first few companies to launch its own outlets to sell branded

jewellery in India. The Gili brand of jewellery, introduced in 1994, was among

the first branded jewellery lines introduced in India. The companys brands and

sub-brands are aimed at different customer profiles, various markets and price

segments and enjoy significant brand equity and market share.The companys

distribution channels include exclusive distributors for jewellery products, direct

sales to large department stores and direct sales to end customers through retail

operations. The company sells diamond and other jewellery products in India

through its nationwide sales and distribution network that consisted of 360

distributors, 259 Company-owned stores, 391 stores set up through franchisee

arrangements and 643 shop-in-shops located in department stores. The company is

also strongly exploring newer channels of distribution such as e-commerce ande-franchising to capitalize on the trend of consumer preferences changing in favour

of modern retail formats and new buying methods. The companys retail

operations are carried out through it various subsidaries and are supported by a

strong inventory

3. INTERNATIONAL DISTRIBUTION AND RETAIL SEGMENTThe company has also established a significant retail and distribution presence in

the United States, the Middle East and certain regions in Asia through it overseassubsidiaries.In the United States, the company operates a retail network of 104

stores through its subsidiary Samuels Jewelers, Inc. which was acquired in 2006.

The Samuels chain has exclusive designer jewellery collections and a large

selection of loose and mounted diamonds under brands such as Samuels


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Jewelers, Schubach Jewelers, Samuels Diamonds, Rogers Jewelers and

Andrews Jewelers which are primarily targeted at middle and upper middle class

consumers in the United States. Headquartered in Austin, Texas, Samuels retail

chain is positioned as a wedding jeweller with category focus on bridal collections

in the United States.In the Middle East, the company operates four stores in Dubaiand also sells to approximately 50 prominent retailers. The company targets the

Indian diaspora who are familiar with its brands.The company has incorporated a

subsidiary in Singapore, Leading Singapore Jewels Pte. Limited in order to expand

its Asian retail presence. In 2012, the company opened its first retail store in

Singapore.The Company is also present in Japanese market through it strategic

stakeholding in IMACBC and Verite Co. Limited. Aston Luxury Group Limited, a

Hong Kong based wholly owned subsidiary of the Company, owns 20% stake in

IMACBC and 15.03% stake in Verite Co. Limited.The company has also increasedits global presence in Italy through brand acquisitions and increased access to

distribution networks on account of strategic acquisitions and investments, in Italy.

The company through its subsidiary Alfred Terry, in the United Kingdom has

gained access to a strong distribution network in the UK and rest of Europe.

The company also acquired Crown Aim Limited, a Hong Kong based company

that has strong distribution network to Hong Kong, China, Japan, the US, Middle

East and Europe

OPERATIONAL HIGHLIGHTS

Significant global presence in the top five jewellery markets of the world

One of the largest manufacturers of precious jewellery.

Largest number of well established jewellerybrands under one roof in the world -

top 6 out of 8 jewellery brands in India and well known internati onal brands

One of the strongest and largest retail networks making it the largest jewellery

house in terms of number of points of sale globally with over 4000 points.

Well balanced and well-diversified business model.

Amongst the fastest growing jewellery conglomerates


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3. STRATEGIES OF GITANJALI GROUP

1. Multi Branding StrategiesMulti Brand Strategy refers to a marketing strategy under which two or more

than two similar products of the same firm are marketed under Different and

unrelated Brand namesare sold. In most of the cases, these products are competing

ones and are marketed under the Brand Names which are completely unrelated.

While knowing these brands will eat into each others'sales , multi-brand strategy

does have manyadvantages .Gitanjali group has opt for Multi Branding Strategy in order to generate

economies of scale by using the basic advantages of the strategy. But it cannot be

denied that Multi Branding Strategy can also fail due to poor management and due

to adoption of unprofitable business models.

The advantages can be:

1. Gitanjali could obtain greater shelf space and leaving little space forcompetitors'products in the market.

2. Gitanjali has a strategy to saturate themarketby filling allprices andqualitygaps to target market by providing huge number of products with their

different prices and features serving for different types of customers.

3. Gitanjali caters to brand-switchers users who like to experiment withdifferent brands and accept good one for long time.

4. It helps the firm's brandmanagers on their toes by generating high degreehealthy internal competition amongst all with better efficiency and better

overall result.

5. It helped Gitanjali to grow its market share under different brands in themarket.
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6. Gitanjali could achieve economies of scale and paases on those benefits tocustomers finally by giving discounts and offers etc.

7. A diversified business portfolio of Gitanjali group allows it to offset theirlosses(if any) in division by the profits of another divisions and thereby

keeping stable outlook in the market.(channel mix,categeory mix,geographic

mix)

2. Expansion strategy

Gitanjali Group has a well defined expansion strategy for retailthroughorganic,inorganic and partnership routes.

Gitanjali Group plans to expand its retail base from the present 2,000 outletsto almost 5,000 outlets in the next few years.

TheCompany ,which is increasingly focusing on its retail business,is likelyto display premium jewellery brands besides its in-store labels in the new

outlets.

Acquisitions including Samuels, Rogers and Tri-Star demonstrating acohesive US strategy is to continue.Gitanjali has entered into a JV with

state-run trading agency -MMTC Limited . It has plans to open another set

of Jewellerystores in India over the next 2 years as a part of the JV.

The next phase of growth to come from expansion in the internationalgeographies of US, Middle East, Japan and China

Gitanjali has ensured a strong manufacturing base through a contemporarysaleable manufacturing setup. It owns seven factories in India across

diamond and jewellery manufacturing. A strong product development and

design function supports the manufacturing.

Gitanjalis foray into lifestyle products has been done with a viewtoleverage existing customer base and domain knowledge Hyderabad SEZ is

being developed to a world class manufacturing facility

3. Strategy of human resources development


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The Company believes investing in people through creating an environment where

people are valued as individuals and are given equal opportunities for achieving

professional and personal goals. The Companys focus on development of Special

Economic Zones includes huge employment opportunities and the Company

already initiated through setting up training centre in SEZ Hyderabad which has acapacity to train more than 1500 workers in diamond and jewellery manufacturing.

4. Generic strategies Operatioanl excellence

Various distribution channels. Securing suitable locations. Ability to hire, train & retain qualified personnel. Regular Staff Training Programs. Various Leadership & Performance enhancement programs. 26 Distributors, 620 Outlets. 17 Franchise outlets. Inventory Management System

5. Market development strategy

New retail outlets Shop in shop concept Expansion Plans Participation in fashion Shows Various new products for different customer profile International retailing


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6. Product development strategy

Product proliferation Focused on quality of growth Replacement of unsold stock melting diamond to mold it into new design on

quarterly basis

Continuous process of product development as a routine work

7. Marketing and Selling strategy in U.S.A

- Jewellery sellers in USA are big on direct marketing even online marketing- They send out catalogues and mailers to actual and potential buyers- An online catalogue is made available which, repeat customers can log on to

using a password

- Jewellery makers in India rely on a combination of print and TV Ads- About 35% of jewellery sales in USA takes place between thanks giving day

the 4thThursday in November and christmas and 15% of on valentines day

- Hence it is important for retailers to be on their toes during this period bothin terms of designs and supplies

8. Push and Pull strategies- Gitanjali Gems used contests and freebies as an integral part of marketing

programmes to lure customers

- It used its marketing mechanism towards making the sale happen- It made available, easy finance and americans are only too happy availing it- A USA customer avails of a long credit period while purchasing jewellery


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- The street stores mostly see planned purchases but malls and departmentstores typically see impulse buying

- In USA, retail stores like Tiffany are brands by themselves.- Gitanjali Gems has retail outlets at Tiffany and earns the goodwill of the

store

- It has to struggle less to win over the customers9. Business model and strategy for growth

Aggressive expansion and diversification strategy includes

a.

Expansion of retail presence and brand portfoliob. Re-aligning the business model to focus on the high-margin diamond

jewellery business

c. Ramping up manufacturing infrastructure to cater to increased demandd. Diversification into distribution of lifestyle and luxury products businesse. Setting up of gem and jewellery SEZsf. Achieve higher margins by moving up value chain

10. Other Strategies

E-commerce emerging as astrongplatform for a groups jewellery retail If the sales dip it reduces working capital available with a jeweller to buy

inventory

At the same time holding too much inventory for too long is also a drag If a piece does not sell for long management decides to melt it and catches

with trendy designs

In India, basic understanding of jewellery is good. Designers can forecastand understand different requirements of the market. Gitanjali Gems takes

full advantage of it


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In India Gold dominates jewellery sales that too much mostly for investmentpurposes. In USA Jewellery is mostly boght for fashion and diamonds

account for 70% of Jewellery sales with the balance coming from Gold

Americans are matured customers as they have higher disposable incomes A bridal ring is the largest selling jewellery item in the USA followed by

fashion jewellery, solitaire and studs

Gitanjali Gems uses software to map customer behaviour, trends andmanage customer relationship programmes

4. FINANCIAL PERFORMANCEFinancial highlights for the year 2012-13

Gitanjali Group announces results for the financial quarter ended June 30th, 2013

Sales 31%

EBITDA 30%

PAT 21%


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1. Net Sales in Q1FY2014 were Rs. 3,919.2 cr as against Rs. 3,384.7 cr. in the

corresponding period last year; up 16%

2. PAT during the quarter was Rs. 35.1 cr as against Rs. 148.9 cr in the similar

quarter last year

3. EPS for Q1FY14 was Rs. 3.82

4. Jewellery Sales in the quarter were at Rs. 2,083.8 cr up 13%

5. EBIT in the quarter was Rs. 174.9 cr as against Rs. 269.2 cr in the

corresponding period last year.

8.The next phase of growth to come from expansion in the internationalgeographies of US, Middle East, Japan and China


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Ratio analysis

Ratios Year 12 Year 11 Year 10 Year 09 Year 08

OPM % 5.23 6.91 6.82 7.71 6.71

NPM % 3.28 4.38 4.23 4.7 5.2

EPS 27.66 26.83 17.34 15.43 16.64

Book Value 277.84 264.43 241.60 222.38 209.58

5. RETAIL OPERATION:

Leading jewellery retailer Gitanjali Groupplans to set up a total of 550 shops in

India and abroad by end of this year, a top company official said.
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"Gitanjali are certainly looking at expansion in retail business and aim to set up

additional 300 shops in India and 250 in abroad by the end of the current year,"

Gitanjali Group Chairman and Managing Director Mehul Choksi told PTI (Press

Trust Of India).

Diverse Retail formats: Multi-format outlets, Multi-Brand Outlets, Exclusive

Brand Outlets ranging from 50020,000 sq.ft. They provide multiple channels like

Shop-In-Shops, Owned Stores and Franchisees. Multiple Retail formats and

channels to ensure effective penetration and wide spread reach

Consumer preferences have changed and lifestyles have improved in India.

Retailing in India has also undergone a transformation. This has filtered through to

the jewellery business creating opportunities for modern retail formats and chains.

Gitanjali has been the pioneer in the branded jewellery segment and is amongst the

first few companies to launch its own outlets to sell branded jewellery in India.

Gitanjali is present across most modern retail formats such as shop-in-shops in

large departmental stores and both, multi-brand outlets and exclusive brand outlets

under owned and franchised stores. Gitanjali has extended its retail presence across

outlets through an increase in the number of doors in order to take advantage of

these opportunities. Gitanjali has a retail footprint of 1.7 mn sq. ft. It is focused

strategically on expanding through the franchisee channel. This has allowed it an

access to markets in smaller Indian towns and cities rapidly.

6.INTERNATIONAL AND DOMESTIC BUSINESS

The expansion in the domestic market will be through a franchise route in

Tier II and III cities as rents are lower than the tier I cities, he said, adding that

about Rs 50 crore will be invested this year for domestic expansion.Besides

operations in India, Gitanjali has a strong presence in leading jewellery markets of

the world. It has the retail chain of Samuels in USA with 110 stores. In the Middle

East, it has four stores in Dubai and over 50 distribution points through leading

retail chains of GCC countries.

In China, Gitanjali has distribution through a chain of 40 stores and a

manufacturing facility for local as well as international supply. In Japan, it has a

significant stake in Gems London Company Ltd which owns Gems TV, one of the
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leading Jewellery selling TV Channels of the world as well as a strong distribution

network supplying to other leading retail chains of Japan. In the design capital of

the world, Italy, Gitanjali owns leading brands such as Stefan Hafner, Nouvelle

Bague, Porrati and Valente. The Italian brands and designs are available to

penetrate markets such as Russia, Saudi Arabia, China and the Far-east. Throughits recent acquisition, Gitanjali also has a well established distribution chain in UK

supplying its jewellery to leading retail chains in UK and in the rest of Europe.

The Gitanjali group aims to expand presence in the international market,

especially in America and Japan this year."Globally, they are looking at expanding

further. They plan to add 250 stores in 2013. America is doing extremely well and

they would like to expand there, followed by Japan.International market has

started improving and now prospects look better, according to the company. "Their

target is to increase our global retail sales by 30 per cent this year. Last year, global

sales were at USD 800 million".

Largest selling brands from the Gitanjali Group include Nakshatra, Gili,

D'damas, Asmi, Sangini and others.
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Gitanjali Today- Business Structure (FY 2013 Revenue contribution)

Financial Highlights


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7. LOGISTIC AND SUPPLY MANAGEMENT OF GITANJALI GEMS

Procurement:

Operations and revenues were dependent upon availability of roughdiamonds.

World's know sources were Angola, Australia, Botswana, Brazil, Canada,Ghana, Russia, South Africa.

Procurement at competitive prices from Diamond Trading Company (DTC),De Beers, S.A from London and South Africa to a selected groups or Sight

Holders

Gitanjalis employees attended offerings of rough diamonds held by DTCperiodically at London.

At Sight, they purchased a series of composite rough diamonds at DTCsstated price.


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Steps involving in Diamond Processing:

Material management- sourcing- logistic & scm- inventory management

Buying/Sourcing Rough Diamonds from De Beers / DTC ( 85% )Monopoly earlier and Balance from others. However in recent years USSR

production has gone up and De Beers share of rough diamonds are now


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reducing in the global market. Hence sourcing has become now easy with

cost of basic raw material going down increasing the profits.

Auction based buyingthe basic raw material Value being very highNeeds larger financial investments for rough

diamonds and finished diamonds and also gold and jewellery alongwith

insurance requirements

Plant and Machinery and its location to suit the costing and pricing (ie)feasibility and viablility - Either own land and building or on lease as per

financial capacity and if 100 % Export Oriented then select a country and

location for SEZ operations

Distribution:

Independent sales and distribution network for diamonds and Jewelleryproducts.

Promoter group companies outside India played major role in developingstrong relationships with customers in the international markets.

Wholesalers acted as procurement agents for Jewellery retailers in theinternational market .

Back home gitanjali has a strong sales and distribution channel by way ofexclusive distributors, direct sales to large departmental stores and reputed

Jewellery lines, and direct sales to and customers through retail operations.

12 retail outlets were established as franchisees. Gili brand was sold though an independent distribution network through

regional offices and operations were handed through retail outlets in host

stores (Shoppers stop)


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Indian gems and jewellery industry location

8.COMPETITORS OF GITANJALI GEMS:

Current and Political Competitors include:

Independent Jewellery Stores Retails Jewellery Stores Chains Wholesales Diamond Traders

Competition Segmentation

Quality Design


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Availability Price

Primary competitors:

Mehrasons Jewellers (Delhi) Tribhuvandas Bhimji Zaveri (Mumbai) B.C. Sen and P.C.Chandra (Kolkata) G.R.Thanga Maligai (Chennai) C. Krishnaiah Chetty (Bangalore)

Tanishq (Mumbai, Delhi, Banglore)Other competitors and their strives in market

Laxmi Dia Jewel Pvt Ltd , Surat was the second largest exporter of polisheddiamonds.

Rajesh Exports Ltd (Bangalore) was the worlds largest gold Jewellerymanufacturer and the country largest exporter of gold Jewellery.

Swarnmandir Jewel Designer (Karnataka) was known for its exclusivedesigner series (916) handicraft gold Jewellery.

Zirconium Jewellery was gaining popularity by Brand Ishtaa. Tanishq: Started 1995 by Tatan Industries Ltd- Principle Promoter is Tata

Group having 110 stores in 78 cities.


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SWOT ANALYSIS:

STRENGTHS

First mover advantage

In its manifold mission, the Gitanjali Group is overall ahead of rivals because it hasbeen the first, or among the first, to make break new ground in many directions

an advantage of momentum it continues to build on.

Integrated, multilocation operations

The Group is active in all stages of the diamond jewellery business, from cutting

polishing rough stones, to design and manufacture of finished jewellery. With

manufacturing operations in India, China and Thailand, and distribution points

across the country, and in the global orbit, on four continents.

Design Strength

Gitanjali has dedicated design teams for each brand company. The design teams

comprise brilliant, award winning designers who gauge market trends and

conceptualize new designs. Gitanjalis 70+ designersintroduce around 4,000 new

designs each year. Designers continually attend exhibitions, seminars, jewellery

shows,subscribe to various design magazines / journals to understand the pulse of

the markets inIndia and the rest of the world. They also collate feedback from

distributors /retailers and the companys sales teams to understandconsumer

needs. Gitanjalis design teams constantly strive tocater to diverse consumer needs

by incorporating real time feedback on the markets into their designs. Designs are

thecompanys prized assets-these are retained in-house and not outsourced. Based

on their characteristics, when translated into jewellery, these designs become part

of a brand.

Light weight and designed jewellery

Skills and technology

Gitanjalis core strength is the expertise of its artisans incutting and polishing

diamonds, and its jewellery designers and marketing teams in developing market-

friendly jewellery in tune with shifting user preferences worldwide, to which it

gives shape using high precision CAD CAM processes and equipment.


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Product range and innovation

Having brought diamonds and diamond-studded jewellery within reach of

consumers previously unable to afford them ,the Group offers a wide variety of

products in classic, ethnic and modern patterns, suitable for consumers at differing

price brackets, in line with market demand in various markets, in India and abroad.At the same time, we continually press ahead with innovations in design and use of

various metalsgold, silver, platinum and stainless steel: we not only keep up

with changing fashionswe make fashions.

Market access and brand support

The Group has quickly secured substantial market share. It has launched a

growing hamper of targeted brands, with powerful communications and

merchandising support. In line with each brand profile, multilayered distributionright down to the retail level, has ensured product delivery to each targeted

consumer segment, whether at up market malls, department stores or exclusive

retail jewellers

WEAKNESS:

1. Lot of capital is used in brand endorsing via celebrity endorsement.

2. Still measures are being taken for semi urban marketing. Its a hit in capital citiesbut have not been able to attract semi urban market.

3. Technology absorption, adaptations & innovation :

The Company has not carried out any specific research and development activities.

The Company uses indigenous technology for its operations. Accordingly, the

information related to technology absorption, adaptation and innovation is reported

to be NIL.

OPPORTUNITY :

1.Expanding geographical presence.

2.Searching for new market around the globe.


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3.Global acquisition is there in large to enhance visibility and acquire knowledge

4 Conversion of diamond into Jeweler before exports.

5.To expand its business in Europe the company has incorporated a wholly owned

subsidiary (WOS) in the name of Gitanjali Resources in Belgium with a view to

explore in that continent

THREAT :

1.Emergence of Low-Cost Brands in the upcoming market.

2.Constant change in consumer preferences

3.Fluctuation in price and gold price

Future Strategy

Gitanjali Gems is constructing the Rajiv Gems Park, which is intended to become

one of the largest Gems and Jewellery SEZs in India. This is the first jewellery

SEZ in India that is privately owned and managed by a company. Under this the

company has already completed the construction of diamond cutting and polishing

units spread over on 1 lakh sqft of area. The company is developing jewellery

manufacturing facility spread across on an area of 2 lakh sqft of area.


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Documents

Gitanjali Group