Bulk commodity trader MMTC is aggressively expanding in jewellery retail. The company is looking to increase the number of showrooms and retail outlets from 15 to 200 in two years. As MMTC prepares to hold exhibitions of its jewellery in Delhi and the national capital region on the occasion of Akshay Trithiya (24-25 April), which is the most auspicious time for buying gold, according to Vedic scriptures, Ved Prakash, director (precious metals) of MMTC, talks to FE?s Noor Mohammad about the company?s expansion plans for the jewellery business. Excerpts:
How is your jewellery business doing?
We achieved about 35% growth in the past financial year. Growth has been substantial in the retail sales of silverware, silver and gold medallions and gold jewellery. Exhibitions have contributed significantly to our market presence. An ambitious growth target of over 25% for 2012-13 is over the previous year?s sales of around R650 crore.
What are your future plans in the retail segment?
MMTC plans to increase the number of its showrooms and outlets from 15 to 200 in two years time. These outlets will aggressively market MMTC’s gold and studded jewellery including medallions and bars. We will also celebrate our Golden Jubilee Year with more golden festivals, events, and showroom launches in Delhi-NCR and other cities. We have ambitious plans to launch MMTC?s own brand of gold jewellery and a sub-brand of teenage jewellery in the near future to increase our precious metals retail business.
MMTC has a joint venture with Gitanjali Gems and its expertise in retail marketing along with the wide range of jewellery would add considerable value to the exhibitions hosted by MMTC. The jewellery is retailed under the brand name ?Shuddhi?. As many as 17 retail stores are operational across the country and the JV has plans to set up in all 63 retail outlets over a period of three years.
How is MMTC dealing with volatility in the gold market?
Conventionally, MMTC does not take any open position for gold and silver. Gold is imported on a consignment basis and is not priced. As and when the end use buyer approaches MMTC for pricing, the cost of metal is finalised with the foreign supplier and after collecting full payment from the buyer, MMTC delivers the gold and remits the payment to the foreign supplier. MMTC has sufficient quantities of gold in various locations in India and services the requirements of buyers who have the flexibility to price the metal and take delivery after payment deposition.