Jewellery major Kalyan Jewellers has improved its performance in Q4 of FY21, though its yearly revenue was hit by the COVID-19 pandemic.
The company executive director Ramesh Kalyanaraman attributed the change to a massive shift of customers from the unorganised sector to the organised gold jewellery trade. `` Better hygiene and more space could have prompted the customers to go to bigger jewellers in the time of coronavirus pandemic. This trend is likely to continue in the current year too with mandatory hallmarking of gold from June.’’
He said the shift has helped the company to improve its gross margin by about 3% from last year to around 17% now in West Asia.
The company’s profit after tax for Q4 at Rs 73.9 crore grew by 54.1% over the same period in the previous year. Consolidated revenue increased by 42.8% to Rs 3056.6 crore. However, for 2020-21 the revenue declined by 15.1% to Rs 8573.3 crore from a year ago.
Kalyanaraman said for the last quarter the revenue in India rose by over 60% and for the whole year the fall was limited to 6.6%. "After the sales washout in the first quarter and marginal improvement in the second, demand began to look up in India in the third quarter with many marriages taking place. In the last quarter we saw sales boom with demand other than for wedding too.’’
However, he said, the West Asian showrooms showed 30 % sales fall in Q3 which the company was able to bring down by half in the last quarter. Kalyan Jewellers has 30 showrooms in West Asia.
Its number of outlets in India increased to 116 with the company opening nine in April of which eight were in South India. "We were planning to open three showrooms in Maharashtra and two in Delhi when the lockdowns were imposed. Now we will do it after the lockdowns,’’ he said.
Kalyan Jewellers has plans to open 21 showrooms in India in the current year. "This is part of IPO mandate to use the money for expansion in India.’’ Kalyan Jewellers Rs 1175 crore IPO in March was oversubscribed by 2.6 times.
The company has also re-launched its gold ownership certificate scheme which was first introduced during lockdown last year. The scheme helps customers to book gold jewellery or coins and hedge against fluctuating prices of the yellow metal. `` It was used by many customers for buying gold during Akshaya Tritiya and for marriages,’’ he said.Though Akshaya Tritiya sales were muted in India, there was better turnout in West Asia, he added.