JEWELLERY INDUSTRY OF INDIA

ACKNOWLEDGEMENT

Pearl Academy of Fashion

FMG-1, 2009

New Delhi

Dear sir,

We take a pleasure in thanking MR.RAHUL JAIN for guiding us throughout our project work, words are in creditable in offering our thanks to guide facilitate our group .This project cannot be completed without our group co-operation and team co-ordination. needless to emotion MR.RAHUL JAIN had been a source of inspiration and for his timely guidance in the conduction of project work and his help for the sourceful completion.

Presented by:

Anjali Saini,

Kajal,

Kanika,

Ambreena,

Manisha

HISTORY OF INDIAN

The word jewellery is derived from the word jewel, which was anglicized from the

Old French "jouel" in around the 13th century. Further tracing leads back to the

Latin word "jocale", meaning plaything. Jewellery is one of the oldest forms of

body adornment; recently found 100,000 year-old Nassarius shells that were

made into beads are thought to be the oldest most jewellery

India in the past was often referred to as the jewel in the crown. If we take a walk

down the country's historic past, we will find that India jewelry is very much a part

of its intrinsic value and dates back to the Mohenjo-Daro and Harappa times

when elegant and intricate jewelry was designed and crafted for its pantheon of

gods.

Indian jewelry range could be categorized as temple, spiritual and bridal. All

these three types of jewelry were embellished with colored stones to highlight the

designs.

The temple jewelry in the India jewelry range involved the adornment of statues

of gods and goddesses with chunky necklaces, which were either strung with

beads or crafted with intricate filigree. 

The statues were also adorned with a number of large chunky bracelets, which

came studded with gems. 

The earrings for the deities were those of clustered beads and had a close

resemblance to that of dangling grapes.  The nose rings too were adorned with

jewels and the ankles bore thick anklets.  The temple dancers later wore the

jewelry, which was initially created for the gods and goddesses. These designs

slowly became a part of the Indian woman's bridal jewelry trousseau.

Spiritual jewelry also became a part of India jewelry range.  It evolved due to

social and religious conditions of the times.  It was considered to be highly

auspicious if one wore precious jewels while attending important celebrations like

a marriage or a puja service.

A unique range of jewelry was specially crafted for these occasions and could be

worn as pendants, bracelets, belts and brooches.  The favorite design for

pendants was that of Ganesha  -  the elephant headed god known to bestow

good luck and good fortune. 

The other emblem, which was also, very much in demand was that of the sacred

syllable OM. The Navaratna ring with nine gems also became increasingly popular

as it is linked to the nine planets and brings with it all the good influence while assuring

the wearer of good luck, health and wealth.

Every state in the country offers its own typical style, a reason the India jewelry

range is wide and varied.  Orissa and Andhra Pradesh are famous for fine filigree

designs in silver, Jaipur is known for its enamel work, Meenakari temple jewelry

is part of Nagercoil, while the kundan work with other precious and semi precious

stones embedded in gold are from Delhi. 

Silver beads are found  all over India especially Rajasthan, Gujarat, Madhya

Pradesh and Himachal Pradesh.  In Assam 24 carat gold is fashioned into

necklaces and earrings which draw their inspiration from the local flora and fauna

e.g. orchid and the lokaparo which consists of two birds placed back to back

Jewelry from Tamil Nadu and Kerala has also been inspired by nature e.g.

paisley motifs, cobra hood and rice grains.

India wedding jewelry is also part of the India jewelry range.  The bridal jewelry

trousseau consists of necklaces, chokers, bangles, bracelets, anklets, toe rings

etc.  However, the sign of a married woman is the mangal sutra, a gold chain

with black beads with a pendant at the end.  The styles vary from region to

region.

OVERVIEW: The gems and jewellery sector is an important component of the Indian

economy. Since the 90s the industry made the quantum leap. India plays a

leading role as the dominant supplier of every kind of diamond, as also an array

of colored stones, required by global jewellery manufacturers.

Gems and jewellery is one of the most important sectors, contributing to India's

export basket. One of the biggest effects of economic liberalization and

globalization has been the radical change that has come about in the gems &

jewellery sector, retail in particular. The industry provides employment to nearly 3

million people. Commerce ministry feels that and the need of the hour is to fill the

gap of jewellery designing and manufacturing specialists required in the sector

for its further growth.

Gems and Jewellery (GJ) has been used by the Indian civilization since ages for

both its aesthetic as well as investment purposes. Precious metals and stones

have been an integral part of the Indian civilization since its recorded history.

India has the distinction of being the first country to introduce diamonds to the

world. The country was also the first to mine, cut & polish and trade in diamonds.

The GJ industry can be classified into various sub segments like diamonds,

colored stones, gold and silver jewellery, pearls, etc. However, the two major

segments in India are gold and diamonds. India dominates the diamond processing trade with 11 out of 12 diamonds being

cut and polished in India. India also dominates the gold and silver consumption

globally with consumption of about 800 tones p.a. The industry holds prominent

significance as it is a net exporter and provides employment to 1.3 mn people

directly and indirectly.

The industry is characterized by highly unorganized trade, labor intensive

operations, working capital & raw material intensiveness, price volatility of gold

especially and export orientation. Demand for gold and diamond jewellery is

driven by festivals and wedding, increasing affluent and middle class population,

increase in per capita spend on luxury items, etc.

Though India plays a dominant role in the GJ industry in terms of processing and

consumption, mining of gold and diamond is amongst the lowest in the world.

India imports gold and rough diamonds along with other precious metals. Gold is

purchased from countries like Switzerland, South Africa, Australia, UAE, etc and

rough diamonds are sourced from Belgium, UK, Israel, UAE, etc. With political

pressure to increase local beneficiation in African mining nations, new cutting

and polishing centers like Botswana, Nambia, Angola will emerge, reducing

India’s dominance in diamond processing.

Gitanjali Group Gitanjali Group a 5000 crores company, strategically positioning itself as the

leading diamond studded jewellery-manufacturing company, today has one of the

largest fully integrated diamond and jewellery manufacturing plants in the

country. The Group, which has been a pioneer in the branded jewellery industry,

has always been at the threshold of boosting the production of quality jewellery,

which has obliquely proved to be an excellent, branding and marketing strategy

backed by a formidable retailing network - all ensuring the group an enviable

advantage in the jewellery arena.

The Gitanjali Group is engaged in the business of sourcing rough diamonds, its

manufacture, import and export of diamonds, manufacture of plain and diamond

studded gold and platinum jewellery and its marketing and domestic retailing. As

Jewellery exports form one of the largest contributors to the foreign exchequers,

the jewellery major Gitanjali, is one of India’s high-end contributors to the foreign

exchequer as well as a major player in the domestic market.

Gitanjali has four decades of experience, being one of the earliest diamond

houses in India. Having received over 50 National and Council awards from the

Ministry of Commerce for outstanding exports, it is today one of the largest

diamond exporting companies in India. Presently the Gitanjali Group has highly

modernized diamond cutting and polishing facilities at 5 locations in India and

globally diversified manufacturing operations in Bangkok, Vietnam and China and

a marketing network spread across Europe, Hong Kong, USA and Japan. The

very basis of their existence is to successfully develop, produce and sell high-

quality jewellery brands worldwide & helps the customers in getting the maximum

Value – For – Money in the process.

Gitanjali has combined a world class manufacturing discipline with a reach-

enhancing retail strategy to emerge as one of the most valuable jewellery

conglomerates in the country today.

Gitanjali has four decades of experience, being one of the earliest diamond

houses in India. The company was accorded a Sight by the Diamond Trading

Company Ltd., London as early as 1968, making it amongst the first Sight

holders in this part of the world. Having received over 50 National and Council

awards from the Ministry of Commerce for outstanding exports, it is today one of

the largest diamond exporting companies in India. Presently the Gitanjali Group

has highly modernized diamond cutting and polishing facilities at 5 locations in

India and globally diversified manufacturing operations in Bangkok, Vietnam and

China and a marketing network spread across Europe, Hong Kong, USA and

Japan.

OUR BRAND - D'damas The Group has its origins in the activities of Mr. Mohammed Tawfique Abdullah,

the grandfather of the Founding Shareholders. Mr. Abdullah began designing,

crafting and selling gold jewellery to retailers in Syria in the early 1900s. In 1955,

the family business moved to the UAE when Mr. Tawfique Abdullah’s son, Mr.

Mohammed Taher Abdullah, moved to Dubai and opened a goldsmith’s shop

under the name Al Abdullah Jewellery Traders LLC (“AAJT”).

The first retail outlet of AAJT was opened in 1959 and the gold wholesale

operations began in 1970. In the late 1970s, Mr. Taher Abdullah and his three

sons, Tawfique, Tamjid and Tawhid, first developed the Damas brand in order to

promote and market AAJT’s products. By the end of 1985, the Group had

expanded into several retail stores, and in 1988 the Group launched its first

branded jewellery line under the Harmony brand.

By 2000, the Group had established retail operations in Qatar, Bahrain, Oman

and Jordan. In 2002, the Group expanded its operations to Kuwait and Saudi

Arabia, and by 2004, the Group had expanded to Egypt, Libya, Sudan, Italy and

India.

D'damas is one of the most popular jewellery brand in the country today with a

presence in over 159 towns and cities joint venture between Gitanjali Gems and

the Dubai based Damas Group; D'damas is a sub-brand that combines

international quality with Indian values.

D'damas' vast variety of brand allows every customer a choice of jewellery to

reflect her personality, tastes and to suit every occasion. It has gold and diamond

studded jewellery matching various lifestyle, occasion and price points that cater

to diversified customers.

D'damas is committed to the highest levels of customer satisfaction, and every

piece of jewellery comes with a special certificate of authenticity assuring of both

the diamond and gold content of the piece. D'damas jewellery is accompanied

with an IGI certificate & Hallmarking, a world renowned, further certifies the

diamonds, which is headquartered in Antwerp.

Each sub-brand under D'damas offers stylized and contemporary designs,

conceptualized and created by an in-house team of award winning designs.

Their strength in design has been recognized repeatedly with D'damas designers

having won a number of design awards.

Indian jewelers D'damas' 14th retail outlet has been inaugurated by Bollywood

star Amrita Rao at the newly renovated Ulhas Jewelers showroom in Margao, the

Navhind Times reports.

The Goan Company is "one of the most celebrated brands of diamond and gold

jewellery" in India according to company managers Vishal Acharya and Vikram

Verlekar.

The two directors also gushed over the new collection, saying it "will complement

the natural beauty of the Goa people and being a tourism paradise will also help

the brand reach out to a wider audience across the globe".

Formed in 2003 by Gem plus Jewelry and Damas of Dubai, D'damas is now a

leading jewelry brand and has a history of endorsements from prominent stars of

the film industry.

The latest vote of support is provided by Miss Rao, with her announcement that

she would be wearing a D'damas ring throughout her latest film, as well as Indian

Power Minister Digamber Kamat, who also inaugurated the showroom earlier in

the day.

D'damas is considering further expansion soon, with a variety of stand-alone

stores and outlets, including one due to open in Panaji in the not too distant

future.

HistoryGitanjali Group was established in 1966 and is one of the earliest diamond houses in

India. Having received over 50 National and Council awards from the Ministry of

Commerce, India for outstanding exports, it is today one of the leading diamond and

jewellery export companies in India. Gitanjali, a $900 million multinational group, is a

Public Listed Company. Gitanjali's unique business model encompasses a wide range

of activities like rough diamond sourcing, diamond manufacturing and distribution,

jewellery manufacturing, jewellery branding and jewellery, lifestyle and watch retailing at

the domestic and international level. The Group has its business spread across the

globe including countries like USA, UK, Middle East, Thailand, Belgium, China, Japan,

Italy and South East Asia.

Gitanjali's firsts include:>> Introducing the concept of affordable branded diamond studded jewellery in India

>> Offering jewellery in Superstores, Department Stores and other such retail outlets at

MRP

>> Offering the same quality, designs and prices throughout India with a certification of

authenticity for the same from renowned diamond grading laboratory

>> Producing the smallest heart shaped diamond (0.03 carat)

>> A mail-order catalogue for branded diamond jewellery.

>> Gitanjali Luxury Lifestyle Festival – a unique celebration for International Luxury and

Lifestyle products.

STORES OF GITANJALI IN INDIANorth

Uttar Pradesh

Delhi

Haryana

Himachal Pradesh

Punjab

Rajasthan

Uttaranchal

East

Bihar

Jharkhand

Orissa

West Bengal

West

Gujarat

Maharashtra

MP and CH

Mumbai

Navi Mumbai

South

Andhra Pradesh

Karnataka

Tamil Nadu

RETAILERS IN DELHIBANKEY BIHARI JEWELLERS

J-19, Sector-18,Noida-201301, DelhiPhone: 0120-2514680

SHRI RAM JEWELLERS

Noida, DelhiMobile: 0120-2514680

TIRUPATI JEWELLERS

Sec18, Market,Noida-201301, DelhiPhone: 0121-2661249Mobile: 9811255822

RAM KUMAR PRAVEEN KR.

2, Central Road, Jangpura,Bhogal S., South Delhi, DelhiPhone: 011-24377977Mobile: 9810153122

KANHA JEWELS

Preet Vihar (East Delhi),DelhiMobile: 9810924575

KANAK JEWELLERS

G-2/H-2, Suneja Towers,Alaknanda Market,South Delhi-110019New DelhiMobile: 9818331558

LAXMI NARAYAN JEWELLERS

Plot No. 8, 1St Floor,Sec-12, Dwarka, New DelhiMobile: 9810356551

R.K.JEWELLERS

165, Hardhiyan Singh Road,Karol Bagh-110005,New DelhiPhone: 25741193 / 25737452Mobile: 9811169062

MATERIALS USED IN JEWELLERY INDUSTRY

AMERICAN DIAMOND AMETHYST CORAL CRYSTAL DIAMOND EMERALD GAMET GOLD GOLD PLATED NAVRATNA BEAD QXIDISED PEARL RUBY AGATE ALEXANDRITE AMAZONITE AMBER APATITE AVENTURINE SILVER CRYSTAL GEMSTONE GOLD FORMED LAKH , LACQUER TURQUISE TOPAZ AQUAMARINE

BERYL CARNELIAN CAT’S EYE CITRINE PLATINUM CITRINE CORAL (MOONGA) DIOPSIDE EMERALD FLOURITE GARNET GOMEDH LOLITE JADE JASPER KUNZITE KYANITE MOTHER OF PEARL

COMPETITORS IN JEWELLERY INDUSTRYTOP 20 INDIAN JEWELLERY INDUSTRY

INDUSTRY NAME OWNED BY

Gitanjali Jewellery Mehul Choksi, CHAIRMAN

Notandas Jewellery Ashok Minawala, Director

TBZ original Shrikant G Zaveri, Chairman

Gem & Jewellery Vijay Jain

ORRA Paresh Mehta, Director

Dimexon Shreyas Doshi, Director

Shernu Mr V. Govindraj, President

Tanishq K. Srinivasan, Director

Emerld Jewellery Madanlal Bamalwa, Director

Joyllukas Group Joy Alukkas, Director

Hajoorilal & Sons Ramesh Narang, Director

Khanna Jewellery Vijay Khanna, Director

Bholason Jewel Subhas Bhola, Director

Bhuramalrajmal Surana Vimalchand Surana, Director

Shambhan Jem Rajiv Jain, Chairman

Sara Jewellery Ajay Kala, Chairman

P.C Chandra &Sons Jewellery P.C Chandra, Chairman1

COMPETITORS OF D’DMAS

About Tanishq:

Tanishq is India's largest, most desirable and fastest growing jewelry brand in

India. Started in 1995, Tanishq is the jewelry business group of Titan

Industries Ltd - promoted by the TATA group, India's most respected and

widely diversified business conglomerate.

This year marks a decade of successful innings for Tanishq. With retail sales

of 1200 crore last year and gunning for 2000 cores this year, Tanishq has

arrived in the Indian jewelry market.

It is a story of a successful Indian enterprise, which has delivered value to its

customers and shareholders in a complex category, marked by its completely

localized front end as well as back end.

1

Tanishq has set up production and sourcing bases with through research of

the jewelry crafts of India. Jewelry at Tanishq is crafted in one of the world's

most modern factories.

The factory complies with all labor and environmental standards. Located at

Hosur, Tamil Nadu, the 1, 35,000 sq. ft. factory is equipped with the latest and

most modern machinery and equipment. Every product at Tanishq is pain

sparingly crafted to perfection. Diligent care and quality processes ensure that

the Tanishq finish is unmatched by any other jewellery in the country.

Tanishq challenged the age-old jeweler’s word with TATA's guaranteed purity.

It exploded the market with facts about rampant impurity across India.

It introduced technology-backed challenge in a category completely governed

by individual trust. Tanishq introduced innovations like Karat meter, the only

non destructive means to check the purity of gold.

Tanishq also introduced professional retailing in the disorganized Indian

jewelry bazaar, where women can shop with comfort and peace, without

worrying about the purity of the jewelry they are buying, as well as, select

from the best jewelry collections available in the Indian market.

Tanishq today is India's most aspiration fine jewelry brand with 91 stores in 64

cities, with an exquisite range of gold jewelry studded with diamonds or

colored gems and a wide range of equally spectacular jewelry in 22Kt pure

gold. Exquisite platinum jewelry is also part of the product range.

GITANJALI

Products: Diamond, Rings, Pendants, Bracelets, Earrings, Bangles, Two-Tones,

Color Stones, Sets.

Collections: Valentine Commitment, Chinese Zodiac, Sign Zodiac, Gili Teens,

Corporate Gifts, Pendants, Agni, Diamond Heart, Princess and Forever

Collection

Gili has a unique and timeless collection of precious jewellery. What's more, these

fabulous pieces are available at really affordable prices, with the Gili certificate of

authenticity

In 1997 GITANJALI introduced Rivaaz, a collection of ethnic Indian jewellery. The

brand has also come out with a range of 24-carat jewellery with a guaranteed .995

fineness under the launch name Gili Gold. Gili has also launched a range of diamond

clusters under the name Agni set in yellow and white gold. It has to its credit added Gili

plus, a premium range of diamond-studded jewellery priced above Rs 20, 000.

TANISHQ

Products: Colors of Royalty, Moham, Diamonds Collection, Wedding

Collection, Aria, Tanishq Design Accolades, Jodhaa Akbar Collection

Description: Colors of Royalty a range of exquisite studded jewelry, reminiscent

of the magical Victorian era. The collection is inspired by the classic design

essence.

The collection Moham comprises designs, motifs inspired by nature that have

been beautifully crafted to make them the most desirable possession this season

No gemstone expresses human emotions more powerfully than a diamond. After

all, a diamond is timeless and finding your perfect piece of diamond jewelry is an

exhilarating and unique experience.

The bride blushes everyone around smiles. The shehnai announces festivity. The

priests chant auspicious promises.

Points of differences between Gili and Tanishq

Gitanjali:

1) It is dependent on other retail outlets and malls

2) Specialized in Diamonds products

3) It has wide range of products under diamond and gold

Tanishq:

1) It has self outlets of its own

2) Speaclized in Bridal Jewellery

3) Deals mostly in Stones and Gems very less collection for Diamonds

There are other major competitors of d’dmas. These include PC jewelers, PP jewelers,

Khanna jewelers, Orra jewelers, Mehra Sons and many more.

HISTORICAL GROWTH RATE OF INDUSTRYMumbai, April 15, 2008- The GJ Export Promotion Council today released the annual

performance figures for the financial year 2007-08. The Indian GJ industry has

witnessed a growth of 22.27% amounting to total exports of US$ 20.8 billion in April

2007- March 2008 against USD 17.1 billion in the previous year.

Export of cut and polished diamonds which was the performance driver for the period in

consideration accounting to nearly 68% of the export basket, grew from USD 10.9 billion

in 2006-07 to USD 14.2 billion in 2007-08. Hong Kong emerged as largest importer of

cut and polished diamonds from India, with a share of 35% of the total exports followed

by united states. Which accounted for 24% and UAE at 13%?

Export of coloured gemstones and others grew from USD 246.4 million in 2006-07 to

USD 276.42 million in 2007-08.

The export of gold jewellery rose bt 8.07% with total exports amounting to USD 5622.41

million in 2007-08 as compared to USD 5202.48 million in 2006-07.

Highlights of Union Budget (2008-09)

Reduction in net profit rate from 8% to 6% for assesses engaged in diamond

manufacturing and trading sector under Benign Assessment Procedure

Import duty exemption on Rough Cubic Zirconia

Reduction of import duty on Cut and Polished Cubic Zirconia and Rough Coral

Highlights 2008-09

Revenues increased by 5.32% from Rs. 4831.74 cr. for the year ended 31st March,

2008 to Rs. 5088.88 cr. for the year ended 31st March, 2009.

Jewellery sales went up from Rs. 2165.83 crores in the previous year to Rs. 2693.90

crores in the current year, representing a 24 per cent growth.

The share of jewellery in the total turnover went up from 45 per cent to 53 per cent.

Despite the economic downturn, operating profits before interest and exceptional

items grew from 226.8 crores to Rs. 251.60 representing an 10% per cent growth.

The net profit for the year stood at Rs. 150.58 crores for 2008-09, marginally lower

compared to the Rs. 160.69 crores in the previous year.

Basic earnings per share stood at Rs. 17.70 while diluted earnings were Rs. 15.34

per share

INDUSTRY CAPACITY

Worldwide, The Gem And Jewellery Industry Has Been Growing At A Good Pace

And Is Currently Estimated At Over Us$ 130 Billion. In India, It Accounts For

Nearly 20 Percent Of Total Indian Exports. It Provides Employment To 1.3 Million

People Directly And Indirectly.

The Indian Gems and Jewellery (GJ) industry is dominated by diamond

processing for exports and gold and silver consumption domestically. The Indian

jewellery market is worth about Rs. 700 bn (USD 16 bn). Of this, domestic

demand for gold jewellery is estimated at about 80% and the balance comprises

diamond jewellery and other fabricate jewellery.

The country is also the largest consumer of gold in the world. It consumes nearly

800 tones of gold that accounts for 20 per cent of world gold consumption, of

which nearly 600 tones go into making jewellery.

The Indian gems and jewellery market continues to be dominated by the

unorganized sector. However, with the Indian consumer becoming more aware and

quality conscious, branded jewellery is becoming very popular and the market for

branded jewellery is likely to be worth US$ 2.2 billion by 2010, according to a

McKinsey report.

The All India Gem and Jewellery Trade Federation is targeting for 2013 a 50 per

cent growth in the retail turnover of the domestic jewellery industry, which is

currently worth US$ 23.24 billion.

Moreover, the government allows 51 per cent FDI in single brand retail outlets,

attracting both global and domestic players to this sector.

According to a report released by Technopak Advisors on the Changing Retail

Landscape in India, the jewellery and watches market is pegged at about US$

13.70 billion. It is expected to register a 12 per cent growth by 2012, touching

US$ 23.60 billion.

The World Gold Council recently estimated the size of India's gold coin market at

about US$ 2.11 billion.

In order to increase the demand during recession, jewelers are concentrating on

newer designs in light weight jewellery.

Jewellery major Joyalukkas has targeted a US$ 2 billion business volume by

March 2012. Significantly, 60 per cent of that volume is expected to come from

Joyalukkas’ operations in the Gulf, headquartered in Dubai. Joyalukkas had

business volumes of US$ 302.3 million from its India operations in 2008-09,

which is projected to touch US$ 834 million in 2011-12, at which time the Gulf

operations are expected to gross US$ 1.25 billion.

The government has cleared Damas LLC’s plans to establish a joint venture

company with Gitanjali Lifestyle Ltd for retail trading of jewellery and related

accessories. The joint venture where Damas would hold 51 per cent stake entails

a foreign direct investment (FDI) inflow of US$ 38 million.

Jewellery retailer Tanishq plans to expand majority of its 117 outlets in 75 cities

as the company sees growth in gold and diamond jewellery market in India

despite slowdown. While Tanishq will have four new outlets ready in some time,

it will increase its annual average sales per outlet to more than US$ 17 million

against the present figure of more than US$ 12.3 million.

Gold jewellery forms around 80 per cent of the Indian jewellery market, with the

balance comprising fabricated studded jewellery that includes diamonds as well

as gemstone studded jewellery.

India is the world's largest diamond processing (cutting and polishing) country

with an estimated 1 million processors handling over 57 per cent of the world's

rough diamonds by value.

Exports According to the figures released by the Gem & Jewellery Export Promotion

Council (GJEPC), India's gem and jewellery exports posted a modest growth of

1.45 per cent during 2008-09 at US$ 21.1 billion, primarily driven by gold

jewellery exports, including medallions and ornaments. The country exported

US$ 20.8 billion of gem and jewellery in 2007-08.

The United Arab Emirates (UAE) was the largest importer of gems and jewellery

from India in 2008-09, with a share of 31 per cent. This was followed by Hong

Kong with 25 per cent and the US with 20 per cent. The gem and jewellery sector

accounted for 13 per cent of India’s total merchandise exports.

The export industry mainly comprises of small-to-large units based in various

special economic zones (SEZs) supplying primarily diamond-studded jewellery.

Gems and jewellery exports in July 2009 aggregated to US$ 1.9 billion as

compared to US$ 1.7 billion in June 2009, according to figures released by

GJEPC.

There has been a growth of 9 per cent in the export of gold jewellery in July this

year. The total export of gold jewellery stood at US$ 627 million as compared to

US$ 576 million in the corresponding month last year.

Also, there has been a 24 percent rise in the export of coloured gemstones. Last

July, around US$ 20 million were exported as compared to US$ 25 million this

year. The total export of cut and polished diamonds for the month of July 2009

stood at US$ 1239 million.

The growth in diamond exports was 28 per cent, in jewellery it was 21 per cent

and in coloured gemstones, it was 22 per cent. The major destinations for

exports have been the US, UAE, Hong Kong, Belgium and Israel. In fact, the US,

UAE and Hong Kong together accounted for over 70 per cent of the total exports

in the previous fiscal year.

Overall exports

Mr. Mehta said that the overall export for 2008-09 was close to the Council’s

target of $21.9 billion on the heels of a substantial demand in the first half of the

last fiscal and augmented gold jewellery exports to the United Arab Emirates

(UAE) which has become, by far, the largest exporting destination accounting for

31 per cent of India’s exports.

This was followed by Hong Kong with 25 per cent and the US with 20 per cent.

The gem and jewellery sector accounted for 13 per cent of India’s total

merchandise exports.

To further boost jewelry exports from India, the industry has been working to

improve its designs to make them acceptable internationally.  The industry has

tied up with leading international design institutes and has also held jewelry

shows in India in the past three years. 

This effort has already reaped dividends.  Its proof lies in the fact that a US

based retailing giant has begun sourcing jewelry from India.

India's jewelry exports looks as if it is headed in the right direction.  The industry

has acquired a make over.  The employment of new equipment has led an

estimated million dollars in sales, which makes India the largest exporter in

diamond jewelry. 

In the jewelry exports market, India's 2500 diamond exporters are making plans

to venture in finished jewelry too.  With the news of tariff removal, most jewelers

have increased their sales projection.  India is presently the No 1 exporter of

small/medium-sized diamonds to USA.

DEMAND SCENARIO OF JEWELLERY INDUSTRY IN INDIA

In spite of the convergence of Diamond and Palladium, the demand for gold

jewelry has seen a regular growth year on year. Countries which are primarily

responsible for this growth are India, China, Italy, Turkey and the USA.

The demand for consumption of gold in jewelry was 6% higher at 735 tones and

also comprised a new first-quarter record.

The US, which accounts for 10 % of world gold demand, is also one of the

markets where public taste in gold jewelry is enjoying a renaissance.

The renewed interest in gold also extends to Japan, a market which showed a

19% increase in demand.

The Indian market – the world’s largest for gold demand – was 23 % higher

following the marriage and festival period which, in turn, has led to restocking by

retailers. The earthquake in India, however, is unlikely to hit demand significantly

as it occurred in an area which comprises only 5% of the total Indian

consumption.

There were sharp falls in demand in Turkey and Taiwan - down 38% and 31%

respectively. This was due to economic difficulties and continued weakness in

investment demand.

But it's not just jewelry manufacturing that is flourishing in India. Jewelry

consumption is expanding as well. India's domestic market is now the third

largest in the world.

A country that once consisted almost entirely of haves and have-nots now has a

burgeoning middle class, and De Beers' advertising has been effective in

persuading Indians to switch from gold—their traditional preference—to

diamonds.

“Demand for diamond jewellery is increasing slowly in India. With gold prices

increasing, people are moving towards diamond jewellery and this year, we

expect diamond jewellery sales to touch Rs 25,000 crore here,” Mehul Choksi,

CMD of Gitanjali Gems and chairman of Ficci’s gems and jewellery committee,

told ET.

Diwali festival sales contribute more than 20% to the total diamond jewellery

sales, Mr Choksi said, adding, this festival, the diamond jewellery demand will be

50% higher compared with last year.

Demand for diamond and colour stone-studded gold jewellery is not increasing

just in metros, but also in medium and semi-urban areas.

. Consumer awareness about diamond certification is increasing and it is helping

branded players to gain more business.

While overall diamond jewellery business will register a growth of 20%, branded

players in the segment will register a growth rate of 40-50%, the market for

diamond jewellery is expected to grow by 20-25% this fiscal from last year’s

numbers of around Rs 18,000-20,000 crore.

Demand for gold in India has an inverse relationship with price volatility. With

increased volatility in current months, the consumption has declined.

Gold Supply and Demand STATISTICS

Investment demand for gold remained very strong in the second quarter of 2009,

rising 46% on year earlier levels as investors continued a flight to quality. Overall

demand for gold fell back from recent high levels as weak economic conditions

and high gold prices combined to impact demand, according to the Q2’09 Gold

Demand Trends report published today by World Gold Council (WGC). Although

gold demand remains very high on a historical basis, total demand in Q2’09 was

down 9% on the levels of a year earlier, a 6% decline in $US value terms to

$US21.3b.

The figures, compiled independently for WGC by GFMS Limited, show that total

identifiable investment demand for gold, which includes exchange traded funds

(ETFs) and bars and coins, remained very strong. Investment demand rose to

222 tonnes, a 46% increase on year-earlier levels, but below the extreme highs

experienced during the previous three quarters when the economic and financial

crisis was at its peak.

Retail investment, which includes demand for physical gold in the form of bars

and coins, had another healthy quarter. Net retail investment was up 23%

relative to the previous quarter and 12% on the levels of Q2’08 as investors,

specifically those in western countries, continued to seek out gold for its unique

wealth preservation qualities. Flows into gold ETFs returned to a more moderate,

but historically robust level of 57 tonnes after an exceptional first quarter that saw

net inflows total 465 tonnes.

Gold's extensive appeal and functionality, including its characteristics as an investment

vehicle, are underpinned by the supply and demand dynamics of the gold market.

DemandDemand for gold is widely spread around the world. East Asia, the Indian sub-continent

and the Middle East accounted for 70% of world demand in 2008. 55% of demand is

attributable to just five countries - India, Italy, Turkey, USA and China, each market

driven by a different set of socio-economic and cultural factors. Rapid demographic and

other socio-economic changes in many of the key consuming nations are also likely to

produce new patterns of demand.

 

Jewellery demand Jewellery consistently accounts for over two-thirds of gold demand. In the 12

months to December 2008, this amounted to around US$61 billion, making

jewellery one of the world's largest categories of consumer goods. In terms of

retail value, the USA is the largest market for gold jewellery, whereas India is the

largest consumer in volume terms, accounting for 24% of demand in 2008.

Indian gold demand is supported by cultural and religious traditions which are not

directly linked to global economic trends.

It should be noted, however, that the economic crisis and the consequent

recessionary pressures that developed over 2007 and 2008 had a significant

negative impact on consumer spending and this, in turn, resulted in the reduced

volume of jewellery sales, particularly in western markets.

Generally, jewellery demand is driven by a combination of affordability and

desirability by consumers, and tends to rise during periods of price stability or

gradually rising prices, and declines in periods of price volatility.

A steadily rising price reinforces the inherent value of gold jewellery, which is an

intrinsic part of its desirability. Jewellery consumption in the developing markets

was, until fairly recently, expanding quite rapidly following a period of sustained

decline, although recent economic distress may have stalled this growth. But

several countries, including China, still offer clear and considerable potential for

future growth in demand.

SupplyMine production

Gold is produced from mines on every continent except Antarctica, where mining

is forbidden. Operations range from the tiny to the enormous and there are

several hundred operating gold mines worldwide (excluding mining at the very

small-scale, artisanal and often ‘unofficial’ level).

Today, the overall level of global mine production is relatively stable, averaging

approximately 2,485 tonnes per year over the last five years. New mines that are

being developed are serving to replace current production, rather than to cause

any significant expansion in the global total.

The comparatively long lead times in gold production, with new mines often

taking up to 10 years to come on stream, mean mining output is relatively

inelastic and unable to react quickly to a change in price outlook. The incentives

promised by a sustained price rally, as experienced by gold over the last seven

years, are not therefore easily or rapidly translated into increased production.

Industrial demand

Industrial, medical and dental uses account for around 11% of gold demand (an

annual average of over 440 tonnes from 2004 to 2008).

Gold's high thermal and electrical conductivity, and its outstanding resistance to

corrosion, explain why over half of all industrial demand arises from its use in

electrical components.

Gold's use in medical applications has a long history and today, various

biomedical applications make use of its bio-compatibility, resistance to bacterial

colonization and corrosion, and other attributes.

Recent research has uncovered a number of new practical uses for gold,

including its use as a catalyst in fuel cells, chemical processing and controlling

pollution. The potential to use nanoparticles of gold in advanced electronics,

glazing coatings, and cancer treatments are all exciting areas of scientific

research.

Gold production

The process of producing gold can be divided into six main phases: finding the ore

body; creating access to the ore body; removing the ore by mining or breaking the ore

body; transporting the broken material from the mining face to the plants for treatment;

processing; and refining. This basic process applies to both underground and surface

operations.

Investing in gold

For thousands of years, gold has been valued as a

global currency, a commodity, an investment and

simply an object of beauty. As financial markets

developed rapidly during the 1980s and 1990s, gold receded into the background and

many investors lost touch with this asset of last resort. Recent years have seen a

striking increase in investor interest in gold. While a sustained price rally, underpinned

by the fact that demand consistently outstrips supply, is clearly a positive factor in this

resurgence, there are many reasons why people and institutions around the world are

once again investing in gold. This website provides you with the background to these

reasons and describes the defining characteristics of the gold market from an investor's

point of view.

RECENT TECNOLOGIES

The jewellery industry in India is taking tentative but definite steps towards technology

even as the country tries to match global standards in terms of purity.

Technology is being used in jewellery designing and manufacturing as consumers’

fancy for innovative designs is on the rise. The use of computer-aided design (CAD) is a

norm with most of the big and branded players. It’s increasingly being coupled with

rapid prototyping, which helps new designs reach market more quickly, thereby

increasing the competitiveness amongst the players.

New Gold Solar-Reflective Window Coatings

Gold aircraft window coatings by PPG Industries’ aerospace transparencies group are being introduced at the National Business Aviation Association (NBAA) annual meeting and convention offer aircraft manufacturers aesthetic choices in solar-reflective coating technology. PPG’s solar-reflective coatings for glass and plastic aircraft windows reduce the amount of infrared energy entering the cockpit and cabin for cooler temperatures and reduced air-conditioning load.

Better outlook for electronics demand

More than one electronics industry analyst is suggesting the outlook for the

semiconductor industry is better than it has been for some time. IC Insights, Supply and

SEMI have all made positive comments on this topic in the last couple of weeks.

New PCB finishes

The demand for improved multifunctional, high reliability printed circuit board

(PCB) finishes is growing. Another product has been added to the market; Dow

Electronic Materials has just announced its latest offering -Aurolectroless™ SMT

immersion gold for ASIG (autocatalytic silver immersion gold) final finish process.

Gold wire bonding is claimed to show exceptional bond strengths when using the

complete ASIG process

“Gold nanotech breath test may show lung cancer early”

Factors affecting cost of jewelry

The dumping of gold into the market by several nations' central banks (whether

through leasing or outright sales) has artificially increased supply, and therefore

lowered the price.

The desire for gold as jewelry affects demand. The gold market in India is closely

watched, since Indian brides are often dripping with gold, when they walk down

the aisle. If there is strong buying in India, during the autumn "wedding season,"

prices can increase.

The desire for gold as a "hedge" against inflation affects demand. With the USA

printing money like mad, inflation expectations are beginning to grow. As this

trend continues, look for the price to increase.

The stability of the international political scene affects demand. As political

turmoil increases, many people purchase gold because it has maintained its

purchasing power, through centuries of unrest and turmoil; paper dollars have

not. As the political situation heats up, expect the price of gold to increase.

Sooner or later, the artificial stimulation of supply will cease. When that happens,

look for the price of gold to go through the roof.

Dollar Price Gold is typically quoted in Dollars, and if the dollar begins to sink

then the value of Gold tends to increase and vice-versa.

Market Fear Whenever the stock markets or political situations look bad then

people tend to fly towards Gold. Stock market crashes, terrorist attacks, or wars

will all tend to push the value of Gold up.

Market Greed As with all investments their performance can be self perpetuating,

i.e they start doing well and so more people get interested, the Gold funds start

appear on the front page of the Money section in the telegraph, and the general

public are advised to buy, buy, buy. This obviously has the effect of pushing gold

prices, and gold mine share prices up, as everyone wants to get in on the act.

Given the huge quantity of stored gold, compared to the annual production, the

price of gold is mainly affected by changes in sentiment, rather than changes in

annual production.

GRAPH OF GOLD PRICING IN PAST 5 YEARS

GRAPH OF PRICING OF GOLD 1 YEAR BACK

GOLD PRICE 2008-09

SWOT ANALYSIS OF GITANJALI

STRENGTH

First mover advantage

In its manifold mission, the Gitanjali Group is overall ahead of rivals because it has been

the first, or among the first, to make break new ground in many directions – an

advantage of momentum it continues to build on. 

Integrated, multilocation operations

The Group is active in all stages of the diamond jewellery business, from cutting

polishing rough stones, to design and manufacture of finished jewellery. With

manufacturing operations in India, China and Thailand, and distribution points across

the country, and in the global orbit, on four continents.

Skills and technology

Gitanjali’s core strength is the expertise of its artisans in cutting and polishing diamonds,

and its jewellery designers and marketing teams in developing market-friendly jewellery

in tune with shifting user preferences worldwide, to which it gives shape using high

precision CAD CAM processes and equipment.

Product range and innovation

Having brought diamonds and diamond-studded jewellery within reach of consumers

previously unable to afford them, the Group offers a wide variety of products in classic,

ethnic and modern patterns, suitable for consumers at differing price brackets, in line

with market demand in various markets, in India and abroad.

At the same time, we continually press ahead with innovations in design and use of

various metals – gold, silver,

platinum and stainless steel: we not only keep up with changing fashions – we make

fashions.

Market access and brand support

The Group has quickly secured substantial market share. It has launched a growing

hamper of targeted brands, with powerful communications and merchandising support.

In line with each brand profile, multilayered distribution right down to the retail level, has

ensured product delivery to each targeted consumer segment, whether at upmarket

malls, department stores or exclusive retail jewellers’

WEAKNESS

Lot of capital is used in brand endorsing via celebrity endorsement. Still

measures are being taken for rural marketing.Its a hit in capital cities but

have not been able to attract rural people.

OPPORTUNITY

Expanding geographical presence. Searching for new market around the globe and

utilizing resources to sell jewellery to village people, as most of the population still

resides in villages. This sector still has to be harnessed.

THREAT

Emergence of Low-Cost Brands in the upcoming market.

Increased Competition in core Markets .

SWOT Analysis of Indian Gems & Jewellery Industry:

Strengths:

About one million craftsmen are associated with this industry. Their skills can be

utilized for designing and making modern Jewellery

Availability of abundance of cheap and skilled labor in India.

Presence of excellent marketing network spread across the world.

Supportive government industrial/ EXIM policy.

Weaknesses:

Small firms lacking technological/ export information expertise.

Low productivity compared to labor in china, Thailand and Sri Lanka.

As the major raw material requirements need to be imported, companies

normally stock huge quantities of inventory resulting high inventory carrying

costs.

Opportunities:

New markets in Europe & Latin America

Growing demand in South Asian & Far East countries.

Rupee value depreciating resulting in a windfall increase in the profitability.

Industry moving from a phase of consolidation

Threats:

China, Sri Lanka and Thailand's entry in small diamond segment Infrastructure bottlenecks, absence of latest technology Unusual increase in the prices of gold and rough diamonds.

DRAWBACK OF INDIAN JEWELLERY MARKET

1. It is highly dependent on imports of raw material due to its export

intensiveness.

2. Long time souring strategy for roughs and should built buying tie-ups with

other suppliers of rough such as argule, ekati,etc.

3. Delays in imports and exports are common on account of inadequate

infrastructure and lack of trained personnel’s to do the same.

4. Jewellery industry is mostly family oriented and focused on the domestic

market.

5. Unorganized.

6. The policies and plans on paper or in the pipeline need to be implemented

faster so that India does not loose out on the competitiveness in the export

market.

Outlook

    India is the fastest-growing jewelery market in the world.

Branded jewelery likely to be the fastest-growing segment in domestic sales.

Expected to grow at 40% p.a. to $2.2 billion by 2010.

Exports expected to grow from $15.5 billion in 2005 to over $25 billion by 2010.

Potential

India has several well recognized strengths which have made it a significant force in the

global Gems and Jewelery business.

Highly skilled, yet low-cost labor.

Established manufacturing excellence in jewellery and diamond polishing.

India is the most technologically advanced diamond cutting center in the world.

Opportunity to address one of the world’s largest and fastest-growing Gems and

Jewellery markets.

Opportunity to leverage India’s strengths to address the global market .

Reference

www.world gold council.com

jewellery industry assignment 2008

wikipedia.com

economic times.com

the hindu

Research and market.com

www.ibef.org

www.reddif.com

www.indiainfo.com

www.fabaretofashion.com

www.financialexpress.com

General comments

Provide Intext citations (Otherwise no grades will be given)

Report of Maximum 40 pages (Rest of the information in the annexures)

Do Proper Formatting

Follow the structure given in the brief

Provide Introduction

Specific comments

First give overview, then History

Give the heading: Retailing

Segement wise study

Number of stores ( Put in annexures)

Productdifferentiation factors

Recent trends

Make structuring better

Taste and Preferences affecting demand

Consolidated Opportunities and Threats at the end

More explanation is required

Overall good effort