Shining glory

PENNY WISE

Q1FY07
OPM NPM Goldiam7.908.40 Gitanjali Gems6.104.20 Classic 9.503.70 Shrenuj & Co6.302.40  The exports pie  Currently, the company along with its four subsidiaries -- Diagold Designs (for the West Asian market), Goldiam Jewels (automated machine set band factory), Goldiam Jewellery (for the US and European markets) and Goldiam HK (other Asian countries) -- cater to the major jewellery markets worldwide with an array of products including rings, earrings, pendants, charms, bangles, necklaces and bracelets.  It has a total 40 designers in India, Los Angeles and Hong Kong and a design base of 10,000 designs with 400 new designs being added every month.  The US is the biggest market for Goldiam's exports and contributes about 70 per cent to the total revenues followed by West Asia and Europe with a share of 15 per cent each. The company sells to wholesalers and retailers in the ratio of 80:20.  This is expected to change to 60:40 as the company believes that doing business with retailers such as Wal-Mart, J C Penny, Zales and Gordons is more profitable. It is also exploring new markets like Japan, Russia, Brazil, Argentina and Australia through its recently acquired subsidiary, Goldiam Hong Kong.  The global diamond jewellery industry is growing at 7-8 per cent with US and Japan growing at a faster rate. It believes that consumers will buy jewellery studded with smaller diamonds which require more labour and higher value addition improving realisations.  Bettering competition  In the diamond jewellery business, the company competes with players like Classic Diamonds, Shrenuj and Gitanjali. The company has better margins and return on net worth vis-