Jewellry

STUDY ON THE REPORT OF INDIA’S

EXPORT SCERANIO ON PRODUCT

RELATED TO FASHION/APPARAL

A report submitted in partial fulfilment of the requirement for the completion of

Semester I in Master of Fashion Management

Under the guidance by:

Ms.Stuti Goenka

Submitted by:

DEBADIPTA GHOSH

RAHUL HELA

DEPARTMENT OF FASHION MANAGEMENT STUDIES

NATIONAL INSTITUTE OF FASHION TECHNOLOGY

KOLKATA

INDIA’S EXPORT SCENARIO ON PRODUCT RELATED TO FASHION/APPAREAL

National Institute of Fashion Technology, Kolkata

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Acknowledgement We, the students of Semester II from ―National Institute of Fashion Technology ―pursuing

our ―Master of Fashion Management‖ take great pleasure in presenting our efforts of

developing a complete project in a very satisfactory and appreciable manner.

Our efforts have been a success due to the Co-operation of the entire Fashion Management

Studies (F.M.S.) Department without which a project of this magnitude, given restriction of

time, could not have been possible.

We owe this project to ―Guest faculty Ms.Stuti Goenka ―whose help, expert guidance and

invaluable Co-operation guided us throughout the research phase.

Thanking You.

Debadipta Ghosh Rahul Hela

Fashion Management Studies Fashion Management Studies

National Institute of Fashion Technology National Institute Fashion Technology

Kolkata Kolkata



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TABLES OF CONTENTS



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1. Introduction

Till the early 1990s, the average Indian bought jewellery for investment rather than for

adornment. Jewellery made of 18-karat gold was not favoured as it was considered a poor

investment.

Confidence in the local jeweller was the hallmark of the gold jewellery trade in India. A

jeweller or goldsmith in a local area had a fixed and loyal clientele. The buyer had implicit

faith in his jeweller. Additionally, the local jeweller catered to the local taste for traditional

Jewellery.

However, since the late 1990s, there was a shift in consumer tastes: women were increasingly

opting for fashionable and lightweight jewellery instead of traditional chunky jewellery.

There was a rise in demand for lightweight jewellery, especially from consumers in the 16

to25 age group, who regarded jewellery as an accessory and not an investment. The new

millennium witnessed a definite change in consumer preferences.

Branded jewellery also gained acceptance forcing traditional jewellers to go in for

Branding. Given the opportunities the branded jewellery market offered; the number of gold

retailer’s in the country increased sharply. Branded players such as Tannish, Oyzterbay, Gill

and Carbon opened outlets in various parts of the country. Traditional jewellers also began to

bring out lightweight jewellery, and some of them even launched their in-house brands.

However, the share of branded jewellery in the total jewellery market was still small (about

Rs. 10 billion of the Rs. 400 billion per annum jewellery market in 2002), though growing at

a pace of 20 to30 present annually. The branded jewellery segment occupied only a small

share of the total jewellery market because of the mind-set of the average Indian buyer who

still regarded jewellery as an investment.

Moreover, consumers trusted only their family jewellers when buying jewellery.

Consequently, the branded jewellery players tried to change the mind-set of the people and

woo customers with attractive designs at affordable prices.

However branded jewellery players will continue to face lot of competition from local

jewellers. In order to gain market share, they will have to come up with designs that

customers want and win the trust and confidence of consumers by hallmarking and

demonstrating the purity of the gold used by them.



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2. EVULATION:-

3. About Indian Jewellery Market:-

1970s to Present

Contemporary Jeweller

19th- 20th Century

Art Nouveau

18th- 19th Century

Victorian Jewellery

13th -17th Jewellery

Renaissance Jewellery

5th-12th Century

Jewellery on Medieval Ages

2500-1800 AD Indus Valley Jewellery

Indian gems and jewellery industry had a market size of US$ 41.61 billion in 2013

Indian gems & jewellery market is highly fragmented with 94% of players operating in the unorganized sector

India is the second largest consumer of gold in the world with 975 tonnes in 2013.



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4. Organized Retail Market Split

5.India’s Position in Global Level-

India and China are the two largest gold consumers in the world followed

by the Middle Eastern region

The Gems and Jewellery industry of India contributes nearly 55% of the

world’s net exports of cut and polished diamonds in value

Food and Grocery

2%

Apparel 33%

Mobile and Telecom

11%

Food Service

7%

Jewellery 6%

Consumer Electronics

8%

Footwear 4%

others 24%

Home and Interior

5%



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6. Significance of Jewellery in Indian:-

Tradition

• Jewellery and Indian women are always linked inherently. During wedding as well as numerous other occasions, a woman is gifted jewellery by her parents

Security

• Security in times of contingency and also serves the purpose of financial need, which can be depended upon

Celebration

• Jewellery are gifted in different phases of life such as, birth and marriage. Ornaments like mangalsutra quintessential for married Indian women



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7. Types of Jewellery

8. Consumption Pattern:-

Mangtika

Necklace

Ear Rings

Nose Rings

Bangles

Arm Band

Rings

Waist Band

Anklet & Toe Rings



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9. Region Preference:-

10. Business Model of Jewellers:-

Busi

nes

s M

odel

Hedging against future Price-rise of Gold

Charging Pure Gold price for low purity Gold

Making Charges of Jewellery

Re Purchase of Old Jewellery



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11. Government Policies:-

12. Major Players:-

The Government of India has allowed 100 per cent foreign direct investment (FDI) in gems and jewellery industry

In order to encourage more investments in the sector, gems and jewellery SEZs have been set up in four states: Maharashtra, West Bengal, Rajasthan and Andhra Pradesh

Formal approval has been given to 13 SEZs in the sector — three have got in-principal approval and seven have been notified, as per the SEZ Board of Approval statistics

The value limits of personal carriage of gems and jewellery products in case of participating in overseas exhibitions increased to US$ 5 mn



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13. Value chain of the Jewellery sector:-

14. A BRIEF ON JEWELLERY INDUSTRY:-

One of the fastest growing segments in the Indian economy with an annual growth rate of approximately 15 percent.

The current market size of the Indian Jewellery Industry is US$ 25 Billion.

Total export of jewellery in the year April-March,2013 was 302081.11 with a 3.36% growth rate & 21.27% share in the total export.

Consumes nearly 800 tonnes of gold that accounts for 20 percent of world gold consumption, of which nearly 600 tonnes go into making jewellery.

The consumption of gold in India has doubled over the past two decades. 402 (tn) in 1989 810 (tn) in 2009.

In 2012, gold imports in India increased 68% year on year to 970 tonnes from 579 tonnes in 2011.

whereas the demand for gold increased by 10% year on year globally to 3,971 tonnes in 2012 .

However, gold prices continued to be volatile till 2015-16 and touched a high of Rs 30,000/- per 10 gm. (Delhi)



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15. SWOT Analysis:-

STRENGTHS

Large integrated jewellery players and having an international presence.

Strong marketing & distribution network. Strong retail presence in India and in U.S.

Strong brand equity and broad product range like Gitanjali, Tanishq.

Net Worth of the total size of the gems and jewellery sector (both domestic and exports) is about Rs 4,15,000 crore . So we can say that it is financially very strong sector.

Highly skilled, qualified and motivated employee.



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WEAKNESSES

OPPORTUNITIES

There may be conflicts of interest between organized & unorganized players.

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.

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.



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THREATS

International Competition:-China, Sri Lanka and Thailand's entry in small diamond jewellery.

Increase in the price of Gold.

Other local competitors. According to the data 97% jewellery sales are by family jewelers.

Threat from producing nation like S.A. & Russia



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16. EXPORTS:-

17. IMPORTS:-

Total export of jewellery in the year April-March,2015 was 310085.11 with a 4.00% growth rate & 23.27% share in the total export.

Exports posted a modest growth of 1.45 per cent during 2012-13 at US$ 24.1 billion, primarily driven by gold jewellery exports, including medallions and ornaments.

The country exported US$ 24.8 billion of gem and jewellery in 2012-13

The United Arab Emirates (UAE) was the largest importer of jewellery from India in 2012-13, with a share of 33% followed by Hong-Kong(25%) and U.S.A(19%).

The 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.

Total imports by India declined by 13.46% y-o-y to U.S $35.37 bn during June 2015 compared to total imports of U.S $40.87 bn in June 2014.

India’s import of jewellery increased by 45.39% in Fiscal 2015 to U.S $ 41.93 bn from U.S $ 28.84 bn in Fiscal 2011.

The total imports of jewellery sector grew at a CAGR of 27.74% for the period Fiscal 2005 to Fiscal 2015.

The imports of rough diamonds has increased by 31.82%, gold bars registered a 10.78% increase and cut and polished diamonds increased by 78.94%.



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18. The Current Economic Condition:-

G & J Industry forms an integral part of the Indian economy with an annual growth rate of approximately 15%. It accounts for 14% of the country's total exports and provides employment to 1.5 mn people directly and indirectly.

Besides being the largest consumer of gold 23% of global consumption producer of polished diamonds 57% by value of the global market .

The export revenue for 2011-12 was US$ 42.84 bn, with cut & polished diamonds contributing US$ 23.33 bn and jewellery US$ 9.50 bn.

In 2015 India and China will capture about a quarter of the global luxury market given economic growth in these two countries.

In terms of geographical markets, the UAE continues to be the largest exporting destination with 44% of exports to the market, followed by Hong Kong with 25% and the US with 12% India with 12% and China with 11% share respectively.

The domestic jewellery market is set to cross US$ 40 bn by 2015.

Diamond jewellery segment looks very promising and is expected to touch US$ 6.41 bn in 2015.

The last few years with growth rates in the range of 20 – 30% .



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19. CONCLUSIONS:-

This is a favourable industry:

Can take advantage of market trends

History proves that jewellery is long-lasting

Highly volatile market, highly attractive

Will overcome the economic crisis

Fast progress in the global jewellery market.

Education

Jewellry