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Shree Ganesh Jewellery House Limited
July 2010
Agenda
Industry Overview
Company Overview
Financial Highlights
Robust Business Model
Investment Highlights
2
Gems & Jewellery Industry
1. The Industry exported goods worth US$ 21.23 bn constituting Sr. Category Sub-category
12.52% of India’s Exports (FY 09) 1. Gemstones Diamonds
Though Diamonds form a major portion of G&J Exports, Gold jewellery Coloured stones – precious,
exports were the primary drivers of industry growth in FY09 by semi-precious, synthetic
contributing US$ 6.87 bn (FY09) with a YOY growth of 23.61%.
2. Jewellery Plain gold Jewellery
2. Indian domestic jewellery market - Rs.700 bn (USD14.58bn).
Studded Jewellery
Urban jewellery market - Rs.280 bn (USD5.83 bn)
Silver Jewellery
Rural & semi-rural market - Rs.420 bn (USD 8.75 bn).
Costume Jewellery
3. Gold jewellery contributes 80% of Indian jewellery market 3. Pearls -
(approx. Rs.560 bn / USD 11.67 bn)
balance is studded jewellery which includes diamond studded as well
Shree Ganesh’s Focus Segment
as gemstone studded jewellery
GOLD JEWELLERY IN TOTAL EXPORT
4. The industry is largely unorganized with over 100,000 jewellery
manufacturing units, 6,000 players in diamond processing and FY09
450,000 goldsmiths
Family jewelers constitute 96% & only 4% being organized
5. With increasing disposable income, buying pattern shifting to
purchase of branded jewellery from organized & reputed outlets
3
Source: GJEPC
Gems & Jewellery Industry
GEMS & JEWELLERY EXPORT GOLD JEWELLERY EXPORT
USD. Bn. USD. Bn.
Source: GJEPC Source: GJEPC
RISING SHARE OF GOLD EXPORTS RISING SHARE OF SHREE GANESH
8 7%
6%
RISING SHARE OF 7 6%
GOLD EXPORT
5%
6
5%
5
4%
4
3%
3
2%
2
2%
1 1%
0 0%
FY2007 FY2008 FY2009
DTA Exports EPZ/SEZ Exports SGJ's Market Share 4
Source: GJEPC
Company Overview
Background Manufacturing Markets Awards
•One of the largest • Manufacturing facilities • Primarily focused on Export • “Outstanding Export
manufacturer exporters of located at Manikanchan, markets which contributes Performance and
‘Handcrafted Gold Jewellery’ Kolkata, a Gems & Jewellery over 95% of Total Revenues Contribution in the Trade
•Promoted in August 2002 dedicated SEZ promoted by with major export markets for Plain Precious Metal
by Nilesh Parekh & Umesh West Bengal Government as UAE, Singapore and Hong Jewellery Exports by Unit
Parekh, belonging to a • Employs over 562 ‘gold Kong from EoU/EPZ” for 2008 &
jeweller family having more karigars’ (craftsmen) from • Expanding Retail Presence 2009
than 5 decades of West Bengal in Domestic Market • Rating in December 2009 of
experience in jewellery • Manufacturing capacity of SE 1A by Crisil indicating
making over 30,500 Kgs of gold High performance
•Investment by Credit Suisse jewellery p.a. capability and highest
PE aggregating Rs. 80 Crs for financial strength
10.99% equity • Promoters awarded
•stake at a price of Rs. 300/- SinGem Young Achiever
per equity share (Pre Bonus Award, Eastern India in
2006
of 1:1) in March 2008
• Four Star Export Trading
House
5
Milestones
2003
1992-2002 Took over 2006
2004
Promoters partnership Promoters
2002 Set up
engaged in firm “Shree awarded
manufacturing
family business Year of Ganesh “Young
unit at
of gold Incorporation Jewellers” Achievers
Manikanchan
jewellery engaged in Award” by
SEZ
manufacturing jewellery SinGems
business
2008
2010-2012
2009 PE investment 2007
Further
2010-2012 expansion to Turnover of Rs. by Credit Opened first
meet growing 2,000 Crs Suisse branded Retail
Strengthening Jewellery store
presence in demand and Received “Four “Outstanding
retail market backward Star Export Export
integration. House” status Performance”
award by
GJEPC
6
Product Portfolio
• Handcrafted hallmarked gold jewellery and gold enameled jewellery
• Gold jewellery studded with precious stones like rubies, emeralds, sapphires, pearls and
diamonds
• Portfolio includes rings, earrings, pendants, bracelets, necklaces, bangles, medallions, gold
coins
• Product catalogue includes Plain Gold sets, Gold Bengal Antique sets, Jadau - Kundan sets,
Gold Mumbai Rajkot Antique sets, Gold and studded Bangles, Polki – Chakri sets
• 15 member strong in-house design development team
• Tie up with Sabyasachi Mukherji, renowned Indian Fashion Designer for high end exclusive
jewellery
7
Business
• Amongst the largest player in the industry
Capacity to produce 21,500 kg of Gold Jewellery p.a.
• Products majorly include Handcrafted Gold Jewellery
Exports • Major markets UAE, Singapore & Hong Kong
• Contributes to more than 95% of turnover
• Some of the International customers such as Ibrahim Al Sayegh
Jewellery, Sparkle Jewellery FZE (UAE), Denzong (Hong Kong),
Wondercut Pte Ltd, Abhusan (S) Private Limited, Excellency Pte
Limited, (Singapore) has been company’s long standing customer
• Wholesale of Handcrafted Gold Jewellery (Deemed Exports)
• Expanding retailing of branded jewellery under GAJA brand through
existing 13 outlets and proposed outlets
• Focus on Tier II & III cities through exclusive shops & franchisees in
Domestic Kolkata, Ahmedabad, Bangalore Chandigarh, Patiala, Bhatinda,
Jalandar, Rajkot, Amritsar,
Ludhiana, Mangalore and Siliguri.
• Company has other brands with different themes mainly targeting
young men and women
• Leading fashion designer Sabyasachi Mukherjee is an empanelled
designer 8
Professional & Experienced Management
Mr. Nilesh Parekh - Experience of over 20 years in the jewellery industry
Chairman, Promoter - Responsible for overall strategic long term plans and product development
- Awarded “Young Achievers Award” by Sin Gems in 2006
Mr. Umesh Parekh - Experience of over 19 years in the jewellery industry
Managing Director, Promoter - Heads global marketing operations and overseas business development
- Awarded “Young Achievers Award” by Sin Gems in 2006
Mr. Sharad Mohata - Practicing Chartered Accountant & qualified Cost Accountant
Non Executive Director, - Professional experience of over 17 years in the field of Accounting, Taxation,
CA, ICWA Project Finance etc.
Mr. P. S. Ingty - Masters degree in Arts and MBA from Leeds University, United Kingdom
Independent Director – Ex IAS - Principle secretary to the Government of West Bengal (1997 – 2002)
Mr. S. C. Chaturvedi - Practicing Chartered Accountant with professional experience of over 38 years
Independent Director, CA in the field of accounting, taxation, project finance, etc.
- Associated with several public and private sector companies as Auditors
Mr. Hemang Raja - B.Com - Mumbai University & MBA - University of Abilene, Texas, USA
Nominee Director - Managing Director and Head-India, Credit Suisse Private Equity Asia
(Credit Suisse) - Ex MD and CEO of IL & FS Investsmart Ltd.
Mr. D. P. Mathur - Masters in Economics from University of Rajasthan
Independent Director - Had been associated with Planning Commission, Center for Management in
Agriculture, IIM-Ahmedabad, UN-FAO, Ministry of Commerce
Mr. T. K. Das - IAS Officer from 1965 to 2001
Independent Director – Ex IAS - 9
Had been Joint Secretary to GoI, Principal Secretary to WB Govt, Consultant to
WHO, Administrator to CSE
Financial Highlights (Stand alone)
Exports
9000
8000
7000
6000
IN US $
5000
4000
3000
2000
1000
0
2007-2008 2008-2009 2009-2010
Domestic
1,600.00
1,400.00
1,200.00
1,000.00
In US $
800.00
600.00
400.00
200.00
-
2007-2008 2008-2009 2009-2010
Retail 8.66 13.84 75.74
Wholesale 192.43 1,353.39 879.38
Financial Highlights (Stand alone)
Revenue EBIDTA
600.00
8000.00
7439.55 550.21
7000.00
6411.83 500.00
461.48
6000.00
400.00
5000.00
In US $
IN US $
293.67
4000.00 3671.58 300.00
3000.00
200.00
2000.00
100.00
1000.00
0.00 0.00
2007-2008 2008-2009 2009-2010 2007-2008 2008-2009 2009-2010
Financial Highlights (Stand alone)
PAT
400.00
350.00
300.00
250.00
In US $
200.00
150.00
100.00
50.00
0.00
2007-2008 2008-2009 2009-2010 PAT Margin
7.00%
6.00%
5.00%
4.00%
In %
3.00% PAT Margin
2.00%
1.00%
0.00%
2007-2008 2008-2009 2009-2010
Robust Business Model
Strategic Location Excellent client relationship
- Easy access to skilled Bengali karigars - Super Distributors - Bulk orders
- SEZ units - tax & custom benefits - Repeat Order due to confidence
- Proximity to Airport - Long standing association with buyers
REVENUES
Rs. 29,426 mn
Strong Designing Capabilities
3 yr CAGR 89% Insulation from price volatility
- Intricate handcrafted design;high
- Gold business enjoys natural hedge
demand
- Gold jewellery bought as investment
- Tie up with Sabyasachi Mukherji
EBITDA - Hedged foreign exchange position
- Technological innovations
Rs. 2,119 mn
3 yr CAGR 84%
Experienced Management
Large Size - Lower Costs
-Professional management
- Nominated Agency
-Promoters individually have 2 decades of
- Canalising Agent
experience
- Four Star Export House
-Jeweller from generations
Growth Strategy
Customer Diversification Product Portfolio Enhancements
• Targeting Europe, Australia, Africa & Middle East • Moving from handcrafted jewellery to machinemade
• Set up Singapore & Dubai subsidiaries to market light, italian and fusion jewellery
products as well as procure gold • Tie-up with more designers both India & Overseas
• Cater hitherto untapped domestic markets • Launch international quality & design in India
Capacity Enhancement Strengthening Retail Foray
• Strengthening GAJA brand
• Capacity expansion to enhance revenues
• Expand from existing 13 retail outlets to 49
• Newer products range - higher market penetration
• Franchisee Outlets Model to penetrate at low capex
• Latest Technology for wastage reduction
• Overseas retail outlets for high end customers
• Better technology for margin enhancement
• More Focus on Tier II & III cities
Integration Pursue Alliances
• Setting up a Gold refinery to add to feedstock • Tie up with more domestic and international designers
• Retail stores to assist in procuring gold for refinery • Targeting international foray with overseas
• Canalising Agency status to allow direct gold import subsidiaries
• Domestic expansion to allow reach to final customer • Tie with stores like Vishal Megamart - high footfall
stores 14
Investment Highlights
Insulated & hedged
One of the largest
Gold Jewellery
organised players
business
Capacity
enhancement & Backward & forward
margin improvement integration plans
Designs for both class Retail plans to tap
& mass domestic markets
Yet to truly unfold
15
Thank You
