The gold rush sweeping the Middle East has a new player, as Gitanjali Group, the biggest jeweller in India, plans a major expansion throughout the region.
Gitanjali, which has endorsement deals with Bollywood stars and is listed on the Bombay Stock Exchange, plans to open 100 stores in the Gulf during the next year, franchising out its more than 50 different brands.
"We are building up a major market here," said Mehul Choksi, the company's chairman and managing director. "It's one of the largest markets outside India that could appeal to our brands. We have huge Indian brands for the Indians living here, and we have some Italian brands to attract Russians and other expats and the many tourists here."
Gitanjali, which combines the names of Mr Choksi's two sisters, Gita and Anjali, aims to invest US$100 million (Dh367.3m) in expanding its Middle East business to account for 15 per cent of sales, up from its current 3 per cent.
The company, founded in 1966, joins a number of other jewellers investing across the Middle East as growing consumer confidence has buoyed retail sales in the past 18 months.
Malabar Gold, based in Dubai with operations in India, now plans to more than triple the number of stores it operates in hopes of expanding sales from $2.4 billion last year to more than $6bn in 2015. Pure Gold Jewellers aims to invest Dh1bn in new stores and factories during the next five years, while Joyalukkas said in February it would raise $100m in a syndicated loan from a consortium of banks to expand its network of stores.
In addition, Mannai Corporation of Qatar and EFG-Hermes, the Egyptian investment bank, are in the process of buying Damas International for $445m.
"[The Gulf] is too huge a market that you cannot ignore. This is the market that would be the second largest for us as far as jewellery is concerned," said Mr Choksi, who wants 200 points of sale in the Gulf within three years.
Currently, the jeweller makes about 50 per cent of its sales from its 4,000 points of sale in India and the rest from China, the United Kingdom, the Middle East and the United States, where it owns the Samuel Rogers-branded stores.
Last year, Gitanjali grew revenues by 33 per cent to 124bn Indian rupees (Dh8.22bn), making it the biggest player in India. Celebrities who have promoted the brand in India include Shah Rukh Khan and Kareena Kapoor.
Mr Choksi expects to achieve $200m in sales from the Gulf within two years.
Gitanjali will open stores in its own name, franchise its brands and sell to other well-known jewellers in the Middle East to achieve its growth plans.
"We have been in the [wholesale] market for 20 years, so we have people on the ground," said Mr Choksi. "We will be tying up with all the main chain stores. They are not competitors because we are brands."
Gitanjali sells Indian brands such as Gili and Nakshatra, as well as the Italian names Stefan Hafner and Rosato.
The company also runs a joint venture in India with Damas called D'damas, which Mr Choksi said was performing strongly.
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