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Last Updated : Dec 06, 2013 08:00 PM IST | Source: CNBC-TV18

Aim to maintain 25% growth, open 1 store/month: PC Jeweller

Speaking to CNBC-TV18, Sanjeev Bhatia, president- finance, PC Jeweller says that talks of a slump in demand are partially incorrect. The fall in demand, he explains, is in gold coins and bullion and not so much in the jewellery segment. Hence, the company is unaffected by this demand fall.

Aided by wedding season and Christmas festivites abroad, Sanjeev Bhatia, president- finance, PC Jeweller, says the company is hoping to maintain its compounded annual growth rate (CAGR) of 25 percent.

Also read: Rupee appreciation may prevent positive movement in bullion

Speaking to CNBC-TV18, Bhatia says that talks of a slump in demand are partially incorrect. The fall in demand, he explains, is in gold coins and bullion and not so much in the jewellery segment. Hence, the company is unaffected by this demand fall.

On the road ahead, Bhatia says the company is aiming to add one store per month.

Below is the edited transcript of Bhatia’s interview to CNBC-TV18.

Q: The recent data that we got is that gems and jewellery exports have risen by nearly 22 percent in the month of October, so could you tell us for PC Jewellers in particular for the last two-three months how the exports have been, what is the kind of growth your company has seen?

A: PC Jewellers has been moving steadily in the export field. If one compares our Q1 versus Q2, then obviously in Q2 the export proportion was much large vis-à-vis the domestic. There are two-three reasons. The first one is that for all jewellery companies, the marriage season is going on currently alongwith the Christmas festivity overseas. This demand generally goes up in the November-December-January period. So, those orders need to be fulfilled during the month of September-October. The rupee depreciation also has played a role because we tend to realise higher making charges if they are denominated in dollars.

Q: Are you saying that the best in terms of your export growth is behind you considering that you were already catering to orders for the months of November-December in September and October?

A: Our exports would continue at an even keel because we basically cater to the wedding segment even overseas. So, they are not dependent on a specific festival like Christmas or New Year. Our growth is more or less constant.

Q: Roughly what is the growth that we could expect on the exports front which is a sustainable run rate for you and eventually, what is the percentage of exports that as a percentage of your revenues that you all are targeting?

A: Currently our exports constitute almost 25 percent of our total revenue and we maintain it more or less at the similar level.

Q: It seems like you had a bit of a rough quarter in the quarter gone by, do you expect your total income to rise this quarter because I do understand that there was quite a bit of deceleration on a year-on-year (Y-o-Y) basis as well as on a sequential basis?

A: Unfortunately, when one compares Q-o-Q, Q1 results were exceptional. Whatever one does in Q2 pays in significance in comparison but if you compare full half year results with the previous half year's results, then you will find that there has been a decent growth not only in the topline but also in the revenue.

Q: What is the rough growth that we could expect for FY14 by way of revenues?

A: We have been growing at a compounded annual growth rate (CAGR) of nearly 25-30 percent for the past two-three years and we hope to maintain the same momentum during the current fiscal also. We should be able to do that figure.

Q: How is the domestic business doing in comparison?

A: The domestic business is okay. We have been hearing rumours that the demand is slowing down, but one should take care to differentiate. It is the demand for gold coins and bullion bars that has gone down. However, the segment in which we operate - the jewellery segment, jewellery segment demand is pretty constant. It is like any other year. We have not seen any major factor coming into play and we have also been helped by the fact that the gold prices have been pretty constant in the past. They have been moving range bound. So, we have not seen anything out of ordinary.

Q: How many stores does a company plan to add in this fiscal year as well as in the next?

A: Currently we have 39 stores and would be adding two more in this quarter only. Basically during this month only we hope to be at the figure of somewhere between 47-50 by March 2014. The next year’s field is vast open and though the plans are being worked out but we will continue to grow by opening atleast one new store every month.

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First Published on Dec 6, 2013 03:40 pm
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