Leading jewellery retailer Malabar Gold & Diamonds, which has set a target of becoming the world’s largest retailer with a 2.5 times growth in revenue to over Rs 75,000 crore by FY25, is on an aggressive expansion spree, opening 33 showrooms in the next three months involving an investment of Rs 1,200 crore.
The Kozhikode(Kerala)-based jewellery retailer is already among the largest in the country both in terms of revenue and footprint, with around 280 showrooms spanning 10 countries — India, the GCC (the UAE, Kuwait, Bahrain, Oman, Qatar and Saudi Arabia), Malaysia, Singapore and the US.
Malabar Group Chairman M P Ahammed told reporters on Tuesday said the company’s sales grew about 50 per cent so far this fiscal over FY21 and is confident of closing FY22 with a topline (revenue) of Rs 31,000 crore.
The group has set a target of becoming the world’s largest jeweller by FY25 with a topline of over Rs 75,000 crore and 750 showrooms.
To achieve the target the company has charted out an aggressive expansion plan both domestically (opening 10 showrooms across eight states, including entering Chhattisgrah), and internationally (12 stores across four countries), over the next 22 days at an investment of Rs 800 crore.
Later, Ahammed told PTI that the company will invest an additional Rs 400 crore to open 11 more showrooms by March, taking the overall footprint to close to 315.
“By FY25, we will have as many as 750 stores and will be the largest gold retailer in the world not only in terms of revenue but also in terms of retail presence,” he said and claimed that opening 22 showrooms in the next 22 days is an industry-first.
Hinting that the IPO plan is off the table now, he said the priority is to expand the business and “as and when we are ready, we well look at a share sale”.
Malabar, despite being privately held, has a large investor base of over 4,000 and of them, over 450 are its own employees and most of its showrooms are thus co-owned.
As part of the aggressive growth plans, the company is expanding its manufacturing base with opening a new unit near Hyderabad and expanding the Kolkata and Thrissur, Kerala units and also opening three more units in the UAE.
This manufacturing expansion and showroom expansion will generate more than 5,000 jobs this fiscal alone, he said.
He added that it has five manufacturing units in Qatar, Dubai, Sharjah and Bahrain and five in India — in Mumbai, Kolkata, Huderabad, Chennai and Thrissur in Kerala.
The first of the 22 outlets in January will come up in Bengaluru (two, of which the first is an artistry concept store on January 8) and the rest will come up across Maharashtra (two), and one each in Chhattisgarh, Delhi, Haryana, Telangana, Tamil Nadu and Uttar Pradesh, said the group’s Managing Director (Domestic Operations) O Asher.
The overseas showrooms will come up in Dubai (four, including three gold souks), and two each in Qatar, Oman, Sharjah and Malaysia, said its Managing Director (International Operations) Shamlal Ahamed.
Ahammed said 80 per cent of the business is still coming from gold and 20 per cent from diamonds but the demand for the latter is growing faster. At the industry level, only under 15 per cent is diamond, he added.
He said Malabar, which began in 1993, was the first gold retailer to sell only hallmarked jewellery.
He also claimed that while the mandatory 2 per cent of net profit as CSR spend was introduced only in 2013, his company has been giving away five per cent of net income from the very first year of operations and will increase the same to around Rs 100 crore now.
Ahammed said from next year, it will enter Africa via Egypt first and then into Morocco and Algeria, and Canada and Britain and doubling down on the US from two-four showrooms.