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OVERVIEW
21%
79%
25%
75%
2011
2012e
2013e
2017f
The size of the Indian gems and jewelry market is estimated US$ 32 Billion in 2013 and
is expected to be US$ 43 Billion by the end
of 2017 on the back of increasing domestic
demand. The country is one of the largest exporters of gems and jewelry and the industry
is considered to play a vital role in the Indian
economy as it is a leading foreign exchange
earner.
On geographical front, Mumbai is the hub
of Indias jewelry industry that receives the
majority of the countrys gold and rough diamond imports. Mumbai has a considerable
number of modern, semi-automatic factories
and laser-cutting units, the majority of which
are located in the special economic zone.
However, most of the diamond processing
is undertaken in Gujarat (primarily in Surat,
Bhavnagar, Ahmadabad and Bhuj) and in
Rajasthan (Jaipur).
20.0%
80.0%
Gold Jewelry
3% during 2012-13 to
2016-2017 as the U.S.
and Japanese jewelry
markets are expected
to bounce back and
Chinas growth is
anticipated to remain
stable in near future.
The countries where
demand is increasing for Indian jewelry
include the UAE, the
US, Russia, Singapore,
Hong Kong, Latin
America and China.
Studded Jewelry
25.0%
75.0%
Gold Jewelry
Studded Jewelry
Source: RNCOS
43.0 42.2
43.1 42.3
2010-11
2011-12
Exoprt
39.0
44.5 43.1
36.9
2012-13e
2016-17f
Import
9.3%
2.7%
5.7%
43.2%
15.6%
23.5%
UAE
Belgium
Hong Kong
Israel
USA
Opportunities
Central banks across the world are pumping in more liquidity in India gems and jewelry market
due to expected uncertainty in the global markets.
Onset of festival season in India
The government has taken number of measures to provide boost to gems and jewelry sector.
Such measures include permission to import diamonds on consignment basis for certification/
grading and re-export by specified agencies, increasing the limit of personal carriage of gems
& jewelry products in case of participation in overseas exhibitions and in case of export promotion tours, and others.
Financial assistance is also given to these sectors under Market Development Assistance and
Market Access Initiative schemes to organize/participate in exhibitions, fairs, buyers-seller
meets and reverse buyers-sellers meets etc. through their respective Export Promotion Councils.
The Indian government has increased import duty on gold jewelry to 15% from 10%, in a
move aimed more at protecting the domestic jewelry industry rather than stemming overseas
purchases to narrow its current account deficit.
Challenges
Persistently higher inflation is leading to reduced discretionary spending by the consumers.
Rising gold prices on account of falling rupee are making it harder for buyurs to afford gold
jewelry.
Indias GDP growth slowed to 5.7% in FY 2013 compared to 6.2% in FY 2012, implying lower
per capita income, fewer jobs and lesser spending power for consumers.
Future Outlook
Keeping in view its past performance, the industrys inherent strengths and growth prospects, the footwear industry aims to augment production, thereby enhancing its exports from the current levels. According to Assocham, exports are expected to grow at a CAGR of 15% in the next 5 years. The industry
will continue to focus on the European countries and the US markets for exports.
With more and more Indian woman joining the workforce, the ladies footwear market in all the categories/segments will grow rapidly throwing up huge opportunities in an area yet to be fully tapped by
various players.
The government is considering the creation of training centres where the laborers can be imparted
training and making efforts towards provision of new and advance technology to the footwear industry
so that it can become more competitive. Further, it is looking into the fact that the footwear industry
needs to improve cost competitiveness through value chain efficiencies. There should be implementation of best practices at a firm level and at the sectoral level through cluster based approach by setting
up cross-industry clusters and supporting them through governmental interventions on infrastructure
like port clearances and power. All this, would increase the efficiency and scale of operations of the industry and would attract more and more FDI. The footwear sector had seen only INR 500 Crores of FDI
in 2012 (Which is only 0.65 percent of Indias total FDI in 2012).
The total imports of footwear of US in 2012 were 2,28,19,69,730 pairs, with majority of imports being
from China. The share of India in total footwear imports of USA was just 0.6%, creating an opportunity
for India to further increase its exports to USA in the future, by warding off competition with China
through supply of better quality products.
Key Players
With the country achieving a leading position in gems
and jewelry sector across the globe, more and more
companies are making a foray in the lucrative jewelry
market.
Presently, the gems and jewelry industry in India is
highly fragmented and comprises of more than 500,000
gems and jewelry players across the country, with the
majority being small players.
Though organized retail accounts for about 4-6% of the
entire market, Indian is increasingly getting acclaimed
as an international sourcing destination for high-quality
designer jewelry. Global companies such as Walmart
and JC Penney source jewelry from India.
Gili
Tanishq
Carbon
Oyzterbay
Trendsmith
Reliance Retail
Damas Jewellery
Gitanjali Gems Ltd.
Swarovski
Diamond Trading Company
Vardhaman Developers
Alukkas
Viswa
Devji Diamonds
Gold Souk India
Recent Developments
Gili Jewelry ties up with Jet Privilege, frequent flyer program
Gili has entered into a tie-up with Jet Privilege, the frequent flyer program from Jet Airways that gives all Jet
Privilege (JP) members certain added benefits when they purchase Gili jewelry.
Gili jewelry brand opens stores in Mumbai and Jaipur
Gili opened two new stores, one each in Thane, Mumbai and Jaipur. Gili now has eight stores across the
Mumbai region, while the Jaipur store is its second in the Pink City.
Gili jewelry store in Kochi
Jewelry brand Gili has opened its first outlet in Kerala at Lulu Mall in Kochi. The store offers a range of diamond and platinum jewelry ranging from ethnic and traditional designs.
Titan to halt expansion of large Tanishq stores
Titan Industries Ltd, Indias largest branded jewelry retailer, is cutting back on expansion of big shops,
partly because of difficulties in finding appropriate locations at affordable prices.
Tanishq to expand footprint in eastern India
Tanishq aims to expand its footprint in eastern India, comprising Odisha, West Bengal, north-eastern states
and Jharkhand with opening of more number of outlets.
Tanishq launches Inara diamond jewellery collection
Tanishq, the jewellery retail brand of the Tata Group has launched a new diamond jewellery collection
entitled Inara. There are over 120 unique designs of diamond jewellery pieces across necklace, bangles,
earrings and cocktail rings priced between Rs.2 lacs and Rs.6 lacs.
Jewellery designer Nirav Modi plans string of retail stores
Diamond jewelry designer Nirav Modi, whose Golconda Lotus necklace fetched INR 160 Million at a
Christies auction, announced to open at least 10 retail stores in India and overseas and introduce pieces at
lower price points.
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