Professional Documents
Culture Documents
on
Gitanjali – A Gem in India’s Crown
Submitted To: Submitted By:
Prof. Rakesh Gupta Kumari Sweta
Lipi Agrawal
Sukalpa Datta
Sushma Kumari
Vikas Sharma
Vipin Khandelwal
Introduction
India is a leading player in the global gems and jewellery market
The gems and jewellery industry occupies an important position in the Indian
economy. It is a leading foreign exchange earner, as well as one of the fastest
growing industries in the country
The two major segments of the sector in India are gold jewellery and diamonds.
Gold jewellery forms around 80 per cent of the Indian jewellery market, with the
balance comprising fabricated studded jewellery that includes diamond studded as
well as gemstone studded jewellery.
The Indian gems and jewellery industry is competitive in the world market due to
its low cost of production and the availability of skilled labor. In addition, the
industry has set up a worldwide distribution network, of more than 3,000 offices for
the promotion and marketing of Indian diamonds.
• Diamond distribution was dominated by a few major diamond mining companies
worldwide among which Diamond Trading Corporation (DTC) was the largest
diamond distributor. It accounted for approximately 50 % of worldwide diamond
distribution.
• Though Indian exports in cut and polished diamonds was growing, it was
restricted to lower-sized and lower-valued diamond market. European
manufacturers dominated the higher-valued diamond market.
• India was among the largest importer of gold in the world and its sale was
sensitive to income level and price level. Also it was dependent on the purchases
based on faith in the retailer.
• Tanishq and Gili were among the earliest jewellery brands in India and later
there came a shift in consumer preferences towards diamond jewellery as it was
positioned as affordable and contemporary.
Indian Retail Jewellery Overview
Yesterday Today
Unbranded Branded
Jewellery sold on commodity basis Jewellery being sold on a per piece basis
with labor charges
Conti…
Major Players:
Tanishq Jewellery
Vaibhav Gems Ltd.
Classic Diamond (India) Ltd.
Shrenuj & Company Ltd.
Goldiam international Ltd.
Su-raj Diamonds & Jewellery Ltd.
Rajesh Exports Pvt. Ltd
Gitanjali Gems Ltd
GITANJALI GEMS LTD.
Business Overview
Established presence
The company is one of India’s largest integrated diamond and jewellery
companies Established in 1986. Sight holder status with DTC through a
promoter group company
Sophisticated and scalable diamond and jewellery manufacturing facilities
Approximately 1,246 retail outlets in India and 143 outlets in the U.S.
Leading brands
Expansions Diversification
POTENTIAL
NEW ENTRY
INDUSTRY COMPETITORS
SUPPLIER BUYERS
SUBSTITUTES
Inter-Firm Rivalry High
• Two types of rivalry.
Inside India
• Large presence of unorganized sector. 0.2 Million
Gold jewelers and over 8,000 Diamond jewelers
Outside India.
• International rivals Such as, China
• Threat from producing nation like S.A. & Russia.
Bargaining Power of Suppliers Medium
• In jewellery industry the suppliers are S.A., UAE, Australia, US, Congo, Botswana,
Russia, DTC.
• Few Alternatives of cutting & polishing.
• Skilled labor
• Bargaining power of India is enhanced because India is largest consumer of gold
jewellery.
Bargaining Power of Buyers Low
Divided in two types
• 1. Domestic buyers &
2. Foreign buyers
• As investment (Demand increase)
• Bargaining power of Indian exporter is high because Majority of the world's rough
diamond production is cut and polished in India.
Threat of Substitutes: Low
• Substitutes are Real assets, Stock market, & Bank deposits &
mutual fund investment and Other types of jewellery like imitation
jewellery, bagasra jewellery, stone jewellery etc.
• Second preferred investment behind bank deposits
• Status and standard of living increase so demand is increasing at
high rate.
Barriers to entry Low to Medium
• Low capital requirement
• Government subsidy
• EXIM policy & government’s rules-regulations are high
• Skilled manpower is essential
• Advanced technology required
SWOT ANALYSIS OF GITANJALI JEWELLERY LTD.
Strengths
• Large integrated diamond & jewellery player and having an international
presence.
• Pioneers of branded jewellery in India.
• Strong marketing & distribution network. Strong retail presence in India and
in U.S. 112 distributors and 1246 outlets in India and 143 outlets in U.S.
• Strong brand equity and broad product range Such as, Gili, Asmi,
Nakshatra, Sangini, D’damas, Vivaaha, Maya, Giantti, Desire, Samuels etc.
• Visionary leadership (Acquiring Nakshatra, Samuels, Rogers etc.)
• Expanding manufacturing capabilities in Mumbai and at special economic
zone in Surat to address increasing demand.
• Net Worth is 3,460.37 million Rs. So we can say that it is financially very
strong company.
• Sight holder status with DTC through a promoter group company.
• Highly skilled, qualified and motivated employee.
Weaknesses
• There may be conflicts of interest between them and certain of their
Promoter group companies.
• As the major raw material requirements need to be imported, companies
normally stock huge quantities of inventory resulting high inventory
carrying costs.
• Technology is less improved compared to China and Thailand’s company.
Opportunities
• New markets in Europe & Latin America.
• Growing demand in South Asian & Far East countries.
• Industry moving from a phase of consolidation.
• Expansion possibilities in lifestyle and luxury products in India like
watches, leather goods, Platinum jewellery because increasing disposable
income of people.
Threats
• International Competition:-China, Sri Lanka and Thailand's entry in
small diamond jewellery.
• Increase in the price of Gold & Diamonds.
• Other local competitors. According to the data 97% jewellery sales are by
family jewelers.
• Threat from producing nation like S.A. & Russia.
Priority – Impact Matrix
High priority High priority Medium priority
Resistance from suppliers and Emergence of new Changing tastes of
decrease in availability of technology consumers.
diamond . Diamond processing and
Fluctuation in prices of cutting.
material.(gold,diamnd)
• Gitanjali Gems reported that consolidated net profits fell 42 percent to INR
291.52 million ($5.97 million) in the third fiscal quarter ending December
31, 2008 as a result of the company’s diamond and jewelry segments
contracting during the period.
• Gitanjali’s third quarter net sales fell 11 percent to INR 11.109 billion
($227.55 million), as diamond revenues declined 19 percent to INR 5.366
billion ($109.98 million).
• The company noted a 17 percent decline in revenues at its India operations
during the quarter and a 7.8 percent drop in revenues from the rest of the
world.
• For the first nine months of the fiscal year, Gitanjali’s net profit fell 6 percent
to INR 1.195 billion ($24.48 million). The company’s diamond business saw
pre-tax profits fall 16 percent during the period, while its jewelry unit profits
grew 27 percent. Group net sales rose 8.3 percent to INR 36.207 billion
($741.56 million).
Future Perspectives
• As per Research and Markets, the gold processing industry in India although,
has around 15,000 players, Only 80 players generate revenues over US$ 5
million. Therefore, there is high growth potential for Indian gems and
jewellery in the global market.
• Furthermore, in spite of the fact that India is not a major miner of precious
metals and stones, the country’s inexpensive and skilled workforce are one of
the best in the world for processing of diamonds, which makes the country a
favored destination with the exporters.
• Additionally, there is a huge potential in promoting traditional Indian designs
and styles. There is a massive demand for hand-made jewellery, especially in
ethnic Indian designs, from the sizeable Indian emigrant population in the
Middle-East, South-East Asian countries, the US and Canada among others.
Thank You…..