India’s Largest Corporate House Enters Jewelry Retail

Reliance Industries, India’s largest corporate house, marked its entry into the jewelry industry with the launch of its first Reliance Jewels outlets, a 6,000 sq ft store in Bangalore last week.

The company plans to open 300 jewelry stores all across India over the next three years, ranging from 2,000 to 15,000 sq ft each.

The Bangalore store, with an investment of about Rs.120 million ($3 million) and showcasing over 10,000 designs, will soon be followed by stores in Hyderabad and Ludhiana. Reliance Jewels is expected to start operations in Mumbai, the country’s financial and jewelry capital, shortly with plans to launch three stores in the first quarter of 2008, and have 20 outlets by the end of the year.

Company officials said the total investment envisaged till 2010 is approximately Rs 60 billion ($1.5 billion), and the projected revenues by then will be in the range of Rs 100 billion ($2.5 billion).

Jewelry for these stores will be sourced from both smaller karigars (artisans) and large manufacturers. The company reportedly has agreements with 50 vendors.

The jewelry retail venture is one of the specialty store formats that Reliance’s retail arm, Reliance Retail plans to set up. Some of the other formats are Reliance Footprint (footwear), Reliance Trendz (apparel), Reliance Wellness (wellness products) and Reliance Digital (consumer durables). In addition, there are Reliance Fresh and Reliance Marts, the latter being a multi-product format that offers everything from jewelry, clothes and consumer durables under one roof.

While the first Reliance hyper mart in the country (spread over more then 50,000 sq ft) is already running in Ahmedabad, the first mini-hyper mart at Amritsar, spread over 15,000 sq ft, will open shortly.

The largest player in jewelry retail today is Tanishq, a brand launched by Titan Industries which is part of another large corporate house Tata Sons, with 100 stores and revenues of about Rs 12 billion ($30.15 million).