In conversation with Ramesh Kalyanaraman, Executive Director, Kalyan Jewellers India Ltd

With changes in consumer preferences and a major shift towards online business along with expansion in the Middle East, Kalyan Jewellers has posted strong revenues, informs Executive Director Ramesh Kalyanaraman in this exclusive interview.

What is your outlook on the Indian jewellery and diamond sector? Are there any emerging trends being witnessed among consumers?

Given the dynamic market and the uncertain times, consumers in India have renewed their interest in jewellery since they have always looked at gold as a safe and attractive long-term asset. Diamond jewellery never goes out of trend. There is a growing demand among the next-gen consumers preferring superior quality products with impeccable craftsmanship. Last year, we witnessed a noticeable shift towards dual-tone jewellery such as rose gold and platinum or rhodium-finished gold jewellery. This year, we are seeing a growing ‘design first’ sentiment among young shoppers, especially Gen-Z.

Kalyan Jewellers’ consolidated revenue growth for Q3FY22 stood at ~17 per cent as compared to the same period in the previous year despite a strong base. Which factors contributed the most to help you outperform?

We have witnessed strong momentum in footfalls and revenue over the past four quarters owing to increased level of vaccinations and continued buoyancy in consumer sentiments. During the festive season, we witnessed continued positive tractions from customers across all markets in India and the Middle East. Despite last year’s strong base performance, we witnessed an overall revenue growth of about 17 per cent. The organised sector has been experiencing strong tailwinds as a result of changing customer preferences. People now prefer safe and hygienic as well as service-backed shopping experience. There has been renewed interest among millennial consumers with respect to making long-term investments in the yellow metal.

As such, our online business has witnessed significant revenue growth. Millennial consumers usually opt for lightweight jewellery pieces with small ticket size. The expansion in gross margin over the past two quarters has been encouraging, especially as it is nearing the pre-pandemic levels. Some of the key drivers for margin expansion have been an improvement in both studded jewellery share and share of revenue from non-south markets. This was driven by the launch of new showrooms as well as introduction of new sub-brands and refreshing designs as part of existing collections. Further, we also witnessed improvement in the Gold Savings Scheme (GSS) enrolments as compared to the same period in the previous year.

Kalyan Jewellers’ e-commerce division Candere has been witnessing healthy growth momentum over the last few quarters. The division recorded a robust revenue growth of over 35 per cent during Q3F22 as compared to the same period during last year. What is Kalyan Jeweller’s vision for Candere over the next three years?

Over the years we have registered consistent growth in revenue from the online business. In the recently concluded quarter, our e-commerce division Candere recorded a revenue growth of over 35 per cent during the quarter compared to the same period during last year, demonstrating continued positive traction of our digitally-oriented initiatives, particularly around e-commerce. Our focus continues to be on creating a holistic ecosystem, strengthening our omni-channel strategy and making the ‘phygital’ model more seamless. We have invested in developing and leveraging technology to offer convenient solutions to customers for purchasing jewellery.

We have introduced services such as Gold Ownership Certificate and ‘live’ video shopping facility which allows customers to browse through and purchase jewellery from the comfort of their homes. From a long-term perspective, we are committed to further strengthening the online arm Candere and we aim to expand its reach to more cities in India while improving our services in Tier I and Tier II cities. Also, we are slowly working on establishing an international presence for Candere. Through this we further aim to address the consumer demand for multiple niche segments and product categories such as white gold and platinum jewellery, catering to the preferences of the ever-growing millennial consumers in India.

Can you throw some light on the performance of the company’s operations in the Middle East?

The Middle East market has immense potential and is one of the three biggest markets in the world. Kalyan Jewellers has a total of 30 showrooms across the region with considerable investments in the market. Currently, we are present across four countries – the UAE, Qatar, Oman and Kuwait. Over the years we have been committed to expanding our presence in the region by making strategic investments and providing a best-in-class shopping experience to our customers by constantly reinventing and introducing a disruptive range of services. In the last quarter we grew by 22 per cent in this market and business has surpassed the pre-pandemic levels. We are seeing a lot of market consolidation in the Middle East and we are keeping a close watch on the market since we are so very opportunistic about it.