About Company’s Business:
Vaibhav Jewellers, a prominent regional jewelry brand based in South India, is led by first-generation woman entrepreneur Bharata Mallika Ratna Kumari Grandhi, alongside her daughter Grandhi Sai Keerthana, as reported by Technopak. Operating primarily in the micro markets of Andhra Pradesh and Telangana, we have established 13 showrooms (including two franchisee outlets) across eight towns and two cities. According to the Technopak Report for FY2023, we hold a market share of approximately 4% in the overall jewelry market of Andhra Pradesh and Telangana, as well as a substantial 10% share in the organized segment within these states. Our strategic focus continues to be on regional expansion into high-growth, untapped areas within these micro-markets, creating a market for branded jewelry in our operational areas.
Vaibhav Jewellers serves a wide range of economic segments within the micro markets of Andhra Pradesh and Telangana through dedicated branded showrooms, with a strong emphasis on the rural market. Our brand positioning centers around “Relationships, by Design,” highlighting our commitment to delivering exceptional designs, high-quality products, transparency, and top-notch customer service. To understand customer preferences better, we engage with target groups through exhibitions, which is a crucial component of our “Go to Marketing Strategy.”
Our journey began in 1994 when our founder, Late Mr. Manoj Kumar Grandhi, envisioned introducing organized jewelry retail in the markets where we operate. Starting as a proprietorship concern, we opened our first showroom in Visakhapatnam, Andhra Pradesh. In 2007, we launched our flagship showroom, V Square, one of the largest ISO-certified jewelry showrooms in Visakhapatnam, spanning 29,946 sq.ft of retail space. We are currently expanding our presence simultaneously in Andhra Pradesh and Telangana to cater to the preferences and demands of both states’ populations, with a strategic focus on the coastal Andhra belt to tap into agri-based customer segments. Over the past three decades, we have built a strong and enduring reputation, making Vaibhav Jewellers a household name in Andhra Pradesh and Telangana with a loyal customer base. Each of our showrooms boasts an extensive and exquisite inventory of designs across various categories, including Gold, Diamond, Gems, Platinum, and Silver Jewelry and articles.
About the Industry:
In the broader context of the industry, the global jewelry market is estimated to be valued at $340.7 billion in CY 2022, playing a significant role in the world economy. Jewelry, a symbol of creativity, status, and exclusivity for centuries, primarily features two precious items, gold, and diamonds, accounting for over 50% of the market. The top three markets in the global jewelry sector are the USA, China, and India, each with varying importance in the diamond and gold segments. India, in addition to being a major market, plays a crucial role in the supply chain for both gold and diamond jewelry.
The global gold market, estimated at 4742 tons in CY 2022, is valued at nearly USD 305.9 billion, with jewelry retail contributing 45% to overall gold demand. Investments in gold coins, bars, and ETFs make up approximately 23% of the demand, with the remainder originating from central banks and the electronics and technology sectors. However, the distribution of demand shares across segments has shifted due to the impact of COVID, as indicated by the Technopak Report.
In a typical year, jewelry accounts for 45% of gold demand, while investment demand, including gold coins, bars, and ETFs, constitutes 23%. Central banks contribute around 17%, with technology and other sectors making up the remaining demand.
In FY 2023, the Indian jewelry retail sector reached a size of nearly USD 70 billion, with organized retail comprising approximately 32%. The unorganized segment continues to dominate the jewelry retail market, with over 500,000 local goldsmiths and jewelers. The industry is expected to grow to around USD 124 billion by FY 2027, driven by economic growth, rising disposable incomes, increased consumer demand for gold, higher gold prices, and a growing interest in other categories such as diamonds, precious stones, and costume jewelry.
FY 2023 also saw the total market size for Andhra Pradesh and Telangana at USD 3.3 billion and USD 2.8 billion, respectively. The Andhra Pradesh jewelry market is projected to grow to USD 6.3 billion by FY 2027, with a CAGR of approximately 18%, while the Telangana market is expected to reach USD 5.3 billion during the same period, also with a CAGR of approximately 18%. The rural market in these two states contributed 50-52% of the total jewelry market in FY 2023, with wedding-related purchases accounting for 60-70% of rural demand, followed by post-harvest investment needs. The organized market comprised approximately 39% of the total jewelry market in Andhra Pradesh and Telangana in FY 2023 and is projected to increase to around 45% by FY 2027. Currently valued at USD 2.35 billion in Andhra Pradesh and Telangana combined, the organized market is expected to grow at a CAGR of 22% to USD 5.21 billion by FY 2027. Regional and national jewelry brands have recognized the potential in Andhra Pradesh and Telangana, establishing a significant presence in Tier 2 and 3 cities, catering to semi-urban and rural consumers, as highlighted in the Technopak Report.
The larger players in the organized jewelry market have consolidated market share away from the unorganized segment, primarily due to the weaker financial positions of smaller players and their struggles during lockdowns, which hindered their operational sustainability. Furthermore, on the demand side, consumer preferences have shifted towards safer shopping experiences in larger retail spaces that allow for social distancing, well-trained store staff, and robust systems and processes, enhancing the appeal of organized jewelry retailers.
Key Financial Information (â‚ą in lakhs):
| Particulars | For the Period Ended June 30, 2023 | Year Ended March 31, 2023 | Year Ended March 31, 2022 | Year Ended March 31, 2021 |
|---|---|---|---|---|
| Equity Share Capital | 390.80 | 390.80 | 97.70 | 97.70 |
| Net Worth | 3,636.51 | 3,445.50 | 2,728.59 | 2,289.86 |
| Revenue from Operations | 5,088.96 | 20,273.44 | 16,939.19 | 14,335.69 |
| Profit / (Loss) after Tax | 192.40 | 715.96 | 436.79 | 207.37 |
| Operating Profit | 353.28 | 1,344.93 | 962.64 | 719.87 |
| Operating Profit Margin | 6.94% | 6.63% | 5.68% | 5.02% |
| Profit/(Loss) Margin | 3.78% | 3.53% | 2.58% | 1.45% |
| Earnings per Share (Basic) | 4.92 | 18.32 | 11.18 | 5.31 |
| Earnings per Share (Diluted) | 4.92 | 18.32 | 11.18 | 5.31 |
| Net Asset Value per Equity Share | 93.05 | 88.17 | 69.82 | 58.59 |
| Total Borrowing | 4,603.90 | 4,600.03 | 4,777.34 | 4,634.34 |
Note: All figures in â‚ą million, except per share data.
Objective of the Issue:
- Capital expenditure cost for the proposed eight (8) new showrooms
- Inventory cost for New Showrooms proposed to be opened
- General corporate purposes.
For more detailed information, you can refer to the IPO Prospectus (RHP) filed by the company.
| Important information regarding the IPO | |
|---|---|
| Open Date | Friday, September 22, 2023 |
| Close Date | Tuesday, September 26, 2023 |
| Issue Size | â‚ą270.20 crores |
| Price | â‚ą204 to â‚ą215 per share |
| Lot Size | 69 Shares |
| Basis of Allotment | Tuesday, October 3, 2023 |
| Initiation of Refunds | Wednesday, October 4, 2023 |
| Credit of Shares to Demat | Thursday, October 5, 2023 |
| Listing Date | Friday, October 6, 2023 |
How to apply for this IPO?
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