Gitanjali Lifestyle - Retail Venture Concept Note

Gitanjali Lifestyle – New Retail VentureApril 2009

Strategy Team

Agenda

• About Gitanjali Group

• The New Retail Venture

– Concept Overview

– Layouts and Options– Layouts and Options

– Commercial Terms

– Proposed Next Steps

2

Gitanjali is integrated player in jewellery segment having presence across

the value chain with significant focus on manufacturing and retailing

Gitanjali Group – At glance

Company Overview

• Established in 1966, Gitanjali is one of the largest and fastest growing integrated diamond

and jewellery players in India

• It has sophisticated and scalable diamond and jewellery manufacturing facilities in India

and China

• The group has accesses to about 1,200 retail points in India, 150 outlets in the U.S., 107 in

Japan and 33 in ChinaJapan and 33 in China

• With significant focus on retail and distribution network to drive growth

• Gitanjali is among the few jewellery companies in India that have fully integrated

operations. Its supply chain infrastructure, diversified and popular brand portfolio, and

retail penetration are matched by very few companies in the industry

• From being a diamond processing company, Gitanjali has come a long way in steadily

shifting its business profile to jewellery manufacturing and retail

• Gitanjali continues to look for opportunities and alliances to gain a bigger share of the

market and utilize its manufacturing capabilities to capture a larger share

Source: Company Data 3

Easy Elegance � Diamond studded branded jewellery at reasonable prices

� Pan-India retail presence with approximately 350 outlets

� Awarded Superbrand status in 2004 by ICSC

The Fire Within � Was originally introduced by DTC

� Premium work wear collection

The Enchanting Enigma � Includes entire range including bridal jewellery

� Awarded Superbrand status in 2004 by ICSC

Partners for Life � Brand focus on couples

� Covers entire product range including bridal jewellery

Gitanjali brands in India have strong pull – targeting across the categories

and segment

Associated Gitanjali Brands

� Covers entire product range including bridal jewellery

The Art of Beauty � Designs combine international quality and Indian values

The Art of the Different � Gold jewellery brand under D’Damas

� Offers contemporary and modern designs in gold jewellery

The Wedding Collection � Plain gold as well as diamond jewellery for weddings

Pure. Proud. Precious � Gold jewellery aimed at Indian wedding market and other similar events

Giantti Unique International

Allure

� High-end jewellery brand

Lifestyle Redefined � Offers branded jewellery, watches and other lifestyle accessories

� Source of “Mined in Canada” branded diamonds

� Canadia branded diamond jewellery sold by retailers in the U.S., Canada, U.K. and Australia 4

The company has dramatically increased its number of retail doors

across the globe

Global count of stores

19941994 19991999 20032003 20052005 20062006 20072007 20082008

10 doors

100

doors

250

doors

400

doors

506

doors

550

doors

774

doors

5Source: Team analysis

First Gili branded

counter India

First Giantti

store China

First Nakshatra

store India • First Asmi store India

• First multi-brand outlet India

• First Sangini store India

• Acquisition Samuels USA

First D’damas

store India

19941994 19991999 20032003 20052005 20062006 20072007 20082008

• Acquisition Rogers USA

First Gili stand

alone store India

•The above numbers do not include sales through other retail doors (B2B).

•Stores include Gitanjali Group and affiliiates

Agenda







6

The new retail concept offers Gitanjali’s retail expertise combined with

national and international branding experience

Concept Overview (1/2)

The new retail

concept offer by

Gitanjali

• Gitanjali, being a successful jewellery retailer with national and

international brands, is looking forward to extending its retail and

marketing expertise to complement its product categories

Concept

Overview

• Existing 10 departmental stores in 9 cities scalable upto 60 stores in

next 5 years

• Mid-sized stores with average of 19,000 sq ft

Source: Company Data; A.T. Kearney

• Mid-sized stores with average of 19,000 sq ft

• Located on high-streets in upcoming towns and cities

• Product categories include apparels, jewellery, lifestyle products,

accessories, cosmetics and perfumes

• Target customer segment are sec A and B

• Store layout and interiors designed by leading Indian design house

and architects

• Revenue sharing model for national and international brands

7

Driven by critical success factors, sizable opportunity exists for mid-sized

modern retail venture in tier 2 and tier 3 cities

Concept Overview (2/2)

Opportunity of

mid-sized

organized retail

venture in tier 2

and tier 3 cities

• Opportunity exists in midsized segment with premium branded

categories in tier 2 and tier 3 cities with discretionary income

• Organized retail is expected to grow at 25-30% in next 5 years

• Large branded players are likely to dominate all categories and

formats

• MBOs are currently more viable than EBOs, particularly in non-metro

locationslocations

Critical Success

Factors

• Pull to drive in footfalls

• Advertising and marketing support

• Competitive advantage for:

o Location

o Loyal customer segment

o Format (availability, accessibility, size, merch. mix and layout)

• Presence of prominent brands

• Experienced management team and trained staff

Source: Company Data; A.T. Kearney8

Unique and seamless shopping experience is backed by company’s

proposition to its customers and partner brands

Value Proposition

Value Proposition

for Customers

Full line departmental

store

Widest assortment

Seamless shopping

experience

Unique departmental

store concept

Mens, kids and women wear, lifestyle and

jewellery products

Destination for jewellery and apparels

Ambiance, well groomed staff, adequate

customer circulation space, easy entry and exit

House >100 national and international brands

Wide range of price, product and brands

Value Proposition

for Brands

Strong and prominent

visibility

High footfalls and

conversion

First mover advantage in

upcoming cities

Extensive marketing

support

Well known retail brands

Ready locations in 10

cities

Key market areas/

locations

Revenue Sharing Model

Source: Team Analysis9

On competition mapping, Gitanjali lifestyle store will have first mover

advantage in most of the locations with unique positioning

First Movers Advantage1

Branded

categories –

Value to

Premium

Gitanjali

Lifestyle ��

Central

Mix of

branded and

private label

ranging from

value to

Trends

Pantaloon��

value to

premium

��

Shoppers

Stop ��

Lifestyle��

Dominated by

private label

ranging from

value to

premium

Westside��

Globus��

Karol Bagh

(Delhi)

Rajori Garden

(Delhi)

Kanpur Indore Gwalior Guwahati

1: Currently mapped to 6 location to be implemented in 2009, remaining 4 location are to be implemented in 2010-11

Source: Team Analysis 10

Pre

miu

mLu

xu

ry

Se

gm

en

tati

on

Gitanjali is taking the mid sized departmental stores to premium and

branded categories

Store positioning

1 cm = 40,000 sq ft (approx.)

Private Label Branded

Va

lue

Pre

miu

m

Se

gm

en

tati

on


Merchandising Map

A comprehensive merchandising mix and categories are targeted towards

premium to super premium space

Value Premium Super Premium

AccessoriesWatches and bags

Cosmetics and perfumes

Writing Instrument

Fashion jewellery, silverware

JewelleryGold and diamond jewellery

Fine jewelleryFine jewellery

Premium watches

Women WearEthnic wear, bridal collections

Sarees and dress material

Casual and western wear

Made to order

Mens WearFormal and semi-formal

Casual wear, ethnic wear

Made to order

Kids WearApparel, toys

Accessories


TierMPV

RankingCity State

Area

(sq ft)

Floor

plate

Target

SegmentCatchment

1 2Karolbagh1

(Delhi)NCR 20,000 5 A & B

• Key shopping destination with strong

residential catchments

• Destination for bulk buyers from

neighboring states

• High footfall and conversion1 2

Rajouri1

(Delhi)NCR 20,000 4 A & B

2 11 Kanpur1 UP 18,500 4 B • Prime market area

Opportunity to penetrate in tier 2 and tier 3 cities targeting A and B

segment consumers

Location Assessment

2 11 Kanpur UP 18,500 4 B • Prime market area

2 17 Indore1 MP 16,315 2 A & B• Prime hotels and residential area,

located in the heart of the city

3 37 Gwalior1 MP 16,000 3 A & B • Prime residential area

3 32 Guwahati1 Assam 20,000 4 A & B • Located in main market

3 34 Agra2 UP 20,000 5 B• Located in main market close to

prime residential & commercial areas

3 55 Raipur2 MP 14,000 2 B• Well known complex located in main

shopping area

3 49 Allahabad2 UP 30,000 5 B • Prime location in the city

3 64 Cuttak 2 Orissa 13,035 2 B • Located in main shopping area

1: To be rolled out in 2009

2: To be rolled out in 2010-1113

Geographical Map

Geographical spread indicates a predominance in the Central and Eastern

with opportunity for infrastructure in Western and Southern India

Rajouri Gardens, New

Delhi **

Karolbagh, New

Delhi ** Allahabad

Gwalior Guwahati

Agra

Cuttack

Indore

Raipur

Kanpur

14

There are substantial growth opportunities backed by Gitanjali’s

commitment towards national expansion

Growth Potential

2009 2014

Gitanjali aims at multilevel expansion reaching out to emerging towns and cities in India.

15

Agenda







16

Stores Images

Gitanjali Lifestyle Store concept…

Note: Layouts are subject to final changes and approvals


Lower ground floor

Destination for kids wear, toys and infants’ section



Ground floor

Destination for fragrances, cosmetics, watches, sunglasses and fashion

accessories



First floor

Destination for gold and diamond jewellery, branded precious jewellery,

silver jewellery and silver wear



Second floor

Destination for women ethnic wear, bridal collections, sarees, dress

material, casual and western wear



Third floor

Destination for men’s formal, semi-formal, casual wear and ethnic wear



Agenda







25

Proposed next steps

Next steps includes meeting the key members and the operations team

for further discussion…

Bhaskar SharmaAsst. Vice President

[email protected]

Gitanjali Lifestyle Limited

B-10, Laxmi Tower, BKC, Next to ICICI Bank,

Bandra East – Mumbai 400051

(O) +91-22-40102121 (M) +91-9967653043

• Schedule meeting with key representatives

• Discuss the detailed layout

• Organize the site visits(O) +91-22-40102121 (M) +91-9967653043

Sadanand PawarPresident

[email protected]

Gitanjali Lifestyle Limited

B-10, Laxmi Tower, BKC, Next to ICICI Bank,

Bandra East – Mumbai 400051

(O) +91-22-40102121 (M) +91-9987593820

• Agree on terms of trade

• Sign the MOU followed by the agreement

•

26

Thank You!!Thank You!!

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Documents

Gitanjali Lifestyle - Retail Venture Concept Note