Rajesh Exports on Retail Expansion Drive

Bangalore-based jewelry manufacturer, Rajesh Exports Ltd (REL), has been rated as the No. 1 company in the gem and jewelry sector in terms of total income in the recently released Dun & Bradstreet listing of India’s Top 500 Companies. The listing covering all private sector companies listed on the Indian stock exchanges, BSE and NSE, as well as public sector enterprises.

During the first half of India’s FY 2006-07 (April-Sept 2006), REL reported a 38 percent increase in revenues to Rs 17,128 million ($384.43 million) and a 25 percent increase in net profit to Rs 211.6 million ($4.75 million).

REL, India’s largest exporter of gold jewelry for over a decade, has recently announced a slew of new initiatives at the retail end primarily in the booming domestic market.

In just over one month it has unveiled showrooms of its new brand, Laabh Jewellers, in 14 locations in 10 states across India. The number of Laabh outlets will reach 40 by the end of 2006 and, according to company director Rajesh Mehta, will exceed 150 by the end of 2007. Laabh is expected to have a presence in  multiple locations across different states through owned and franchised stores.

Positioned as “The Complete Jeweller”, the new retail branded chain will offer 22 karat gold jewelry in an exclusive portfolio of 3,000 designs. It seeks to impact the huge unorganized market for gold jewelry in the country by introducing a high quality product range in which every piece will have an absolute guarantee of purity and be fitted with standardized fittings and mountings. The products include items both in plain gold and studded with CZ and precious stones and will be targeted at the fashion conscious urban consumer. They will be priced between Rs. 450 to Rs. 3,00,000 ($10 - $67,300) and manufactured entirely at the company’s Bangalore based factory.

According to Mehta, REL expects to achieve a turnover of Rs 7.5 billion ($168.34 million)  in the first full year of operations and has “definite plans to take the chain outside India in the near future.”

In the second phase of its retail expansion drive to be undertaken in March-April 2007, the company plans to establish 100 retail stores under the brand Shubh Jewellers targeted at both, the urban and rural clientele at a cost of Rs 3.5 billion ($78.56 million).

Rajesh Exports is also in the process of designing an international range of diamond jewelry, which will be launched by January 2007 in all its retail stores. According to reports in the media, the company is also reported to be in talks with a large American lifestyle company involved in the manufacture of watches and jewelry to set up a 50:50 Joint Venture, though Mehta declined to comment on these reports.