Gitanjali set to invest Rs 150 cr for expansion

Gitanjali Gems Ltd will invest Rs 150 crore over a period of three years in jewellery retail trade with a target of achieving more then Rs 700 crore in retail turnover by the end of 2006-07.

The company achieved a retail turnover of Rs 250 crore in 2005-06.

"The company has created a corpus of Rs 50 crore through a retail fund 'Infinity' for the expansion and further investment of Rs 100 crore have been planned in the next two years," said Mehul Choksi, chairman.

The company through its division Gitanjali retail venture will open multi-branded exclusive stores ranging from 250 to 5000 square feet across the country. The stores will be a mix of company owned and franchised outlets.

Infinity would independently form joint ventures with multi-unit franchisees having three and above outlets and finance up to 50 per cent of their total inventory requirement in all the outlets.

Gitanjali has planned to rope in a total of 250 jewellers for this retail initiative by the first year and another 2,500 over a period of three years.

Commenting on the exports, Choksi said their focus will be in export of brands to different markets against jewellery to retailers.

"The branded share of jewellery exports was just Rs 25 crore of the total Rs 250 crore and we are targeting Rs 100 crore exports in branded jewellery in 2006-06, through franchise or shop-in-shop," he said.

Retail roll out will touch 150 outlets in the first year and 1,000 outlets by the third operational year.

The company also announced an online and on-ground venture integrating loose diamond retailing with the transparent issue of its price list through an 'Ezeediamond' initiative.

Packs of loose diamonds will be available under the Ezeediamond brand. Each pack will contain diamonds worth one carat and an IGI certificate.

"A new diamond index would also be created wherein prices of loose diamonds would be reflected on a daily basis based on a panel decision," said Choksi.

The ezeediamond index will go online from the end of may 2006.

The company will also promote Tiesa, 'The preferred jewellers of India' that will showcase centres of excellence in jewellery retail. It will be a distinctive mark, distinguishing member retail outlets.

The retail roll out will cover 500 outlets in the first year.

In the first phase 'tiesa' will invite retailers to voluntarily enrol and the outstanding retailers will be incorporated into a retail association. The second phase will be open for branded jewellery.