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					LVMH to enter jewellery retail in India
LVMH may also introduce products from joint venture De Beers diamond jewellers in India
Following the acquisition of Bulgari SpA last year, French luxury products group LVMH Moët Hennessy Louis Vuitton SA
will soon enter the retail jewellery business in India.
“Jewellery will come, I don’t know when, but in the short term,” said Franck Dardenne, newly appointed general
manager for the Indian business.
LVMH sells Tag Heuer, Zenith and Dior timepieces in India. Elsewhere, it also sells Bulgari jewellery and De Beers
diamond necklaces and had a revenue of $2.66 billion as of December 2011.
The group acquired Bulgari in May 2011 for $5.2 billion to double the size of its watches and jewellery unit, in what was
one of LVMH’s largest acquisitions in a decade. Bulgari has a limited retail presence in six cities in India through
distributors, that predates the acquisition. Following the acquisition, the global transition is under way and plans for the
India business will be in place soon, said Dardenne.
LVMH may also introduce products from joint venture De Beers diamond jewellers in India. The joint venture with De
Beers SA, operational since 2001, launched its first store in China in May last year. It’s reportedly looking at emerging
markets for growth in Asia.
The De Beers group has a wholly owned subsidiary in India that launched diamond brand Forevermark in January 2011 in
Bangalore.
“The Indian jewellery market is huge, but it’s largely unbranded. The time will come when customers will look for
branded jewellery like Bulgari,” said Dardenne, while explaining that the LVMH brands are already popular among
Indians.
Jewellery with a value of more than Rs 10 lakh per piece or diamond solitaires of 3 carats or more constitute the third
largest luxury segment after real estate and automobiles at $730 million, according to India Luxury Review 2011
compiled by AT Kearney.
Watches, an area that LVMH is keen on expanding to become one of the top three in the country, is a $50 million market
in India, according to the report.
In the mid-premium segment, branded jewellery is now well accepted with brands including Nakshatra, Gili and Asmi.
“Organized sector penetration in jewellery has grown to 15% from 6% over the last five years,” said Neelesh Hundekari,
principal, head, luxury and lifestyle practice, AT Kearney. “Though branded jewellery penetration in the luxury end is low,
focus and concerted brand-building efforts could help achieve the same over time.”
Iconic US jewellery brand Tiffany and Co. signed up with UB City in Bangalore and DLF Emporio in Delhi about four years
ago when the malls were launched. But the brand’s plans were scuppered by the global slump. There have been reports
that the brand may be looking at a joint venture partner in India.
LVMH is also betting on the larger Indian consumption story. It will review operations once there is clarity on conditions
attached to foreign direct investment (FDI) in single-brand retail, such as sourcing goods from small and medium
enterprises. Earlier this year, the Indian government allowed 100% FDI in single-brand retail with conditions.
The group’s private equity arm, L Capital, bought an 8% stake held by Wolfensohn Capital Partners for close to $283
million in unlisted Indian ethnic wear chain Fabindia, Reuters reported on 15 February, citing two sources.
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Source: The Live Mint 23 Feb 2012

				
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posted:1/4/2013
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