Renaissance Jwly plans 250 retail outlets over 3 yrs

Renaissance Jewellery , manufacturer of studded gold, platinum and silver jewellery, has debuted with expected premium of 26.67% at Rs 190 as against issue price of Rs 150. The stock has hit a high of Rs 200 in early trade and remained above Rs 160 levels despite negative sentiment in the market.

Sumit Shah , MD, Renaissance Jewellery , said they will roll out 250 retail outlets over the next three years. He told CNBC-TV18, that they expect to maintain 35% CAGR going forward.

Excerpts from CNBC-TV18’s exclusive interview with Sumit Shah:

Q: Do tell us where your key growth will come from next year - would it from your retail outlets or non-branded or commoditised jewellery?

A: I think we see a lot of growth coming from our non-India business as well as our Indian operations. We see our business consolidating and growing in the US. We have also entered into European, Middle East and Far-Eastern markets. We have also planned retail outlets in India. So I think the future plans for growth are pretty aggressive and we see growth coming from different avenues going forward.

Q: We estimate that in FY09, you’ll probably do sales of more than Rs 600 crore and profits of about Rs 40 crore - is that durable target for you?

A: Historically as a company over the last 3 to 4 years, we have maintained a 35% of a compounded annual growth rate. So given Renaissance’s position of being one of the largest exporters of jewellery from India and India gaining dominance in the jewellery sector, we don’t see a problem continuing to grow at these historical growth rates.

I can’t talk about specific numbers, but I feel pretty confident that we will be able to hit our historical growth numbers going forward as well.

Q: How much can you break up your revenues next year in FY09 between how much will come from the export market and how much from the domestic market and secondly, how many retail stores do you expect to have by the end of 2009?

A: I think our plans are to rollout 250 retail outlets over the next three years between shops and as well as company owned stores at the end of FY09. I don’t we have specific numbers right now - what it would be about in a year and a half from now. But broadly, in terms of a three-year plan, we have plans to increase our number of stores to 250 stores.  But we will still see a large majority of revenues coming from businesses outside India because our retail business in India is yet in an early stage. We have started our first store in May of last year. So we are in the process of growing our India business. But we see 90% of our revenues coming from non-India businesses for FY09.