Joyalukkas to open 60 new stores in 3 years, drops IPO plans

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Joyalukkas, one of the leading jewellers, plans to open 60 new stores in next three years largely outside southern States.

The move is aimed to increase revenue from non-south States to 25 per cent from 15 per cent.

Despite major expansion, the company does not want to revive attempts to tap the capital market as it plans to fund the expansion through internal accruals and bank facilities.

Joy Alukkas, Chairman and Managing Director, Joyalukkas told businessline that the company currently has 101 showrooms including 59 outside the country and riding on existing presence in Punjab, Delhi and Maharashtra, it will venture into Gujarat, Uttar Pradesh, Bihar and Rajashtan.

Unlike few other jewellers, Joyalukkas believes in owning all its showrooms and does not want to consider franchise model in near future, he added.

In the June quarter, the company’s sales increased by four per cent to ₹6,965 crore against ₹6,671 crore logged in the same period last year. Ebitda increased 25 per cent to ₹910 crore (₹726 crore).

Last fiscal, the company has registered 15 per cent growth in turnover at ₹24,830 crore and Ebitda was at ₹2,312 crore.

Robust demand

“The domestic demand has bounced back after the government reduced import duty on gold in the Budget. Despite the geo-political issues, the global demand remains firm for the company as its overseas target customers were not that much impacted,” he said.

“One Nation, One Rate” gold policy is already adopted by most of the leading jewellers in south India and that is one of the reasons for organised jewellers gaining more market share in southern States, he added.

The introduction of self regulatory organisation will bring in more transparency and adoption of best practices in the industry. It will also boost bank financing to the industry, he said.

Initially, the company planned initial public offer in 2018 but was forced to abandon it due to unfavourable market conditions.

In March 2022, the company filed its draft red herring prospectus with SEBI to raise ₹2,300 crore through IPO but had to defer it again due to unfavourable market conditions. Last year, the company made an attempt to tap the primary market and pulled out for various reasons.