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Damas to raise gold factory output by 50%
Dubai jewellery group Damas International said yesterday it plans a 50 per cent output capacity hike at a gold factory it owns jointly with Emaar Industries and Investments by end 2009.
- Reuters
- Published: 23:37 July 24, 2008
Dubai: Dubai jewellery group Damas International said yesterday it plans a 50 per cent output capacity hike at a gold factory it owns jointly with Emaar Industries and Investments by end 2009.
The Dh1 billion ($272.3 million) factory in Dubai, a growing regional gold hub, manufactures 12 tonnes of gold jewellery per year.
The plant of Emirates Jewellery Manufacturing, the joint venture firm set up in 2007, is the largest in the UAE.
"The demand for gold jewellery in the region is booming and we want to capitalise on that boom," said Tawhid Abdullah, Damas' chief executive.
"Our plan is to increase output by about 50 per cent by the end of next year, but we can always go higher if there is a market demand," he said.
Around half of the factory's output is sold through domestic outlets and the rest is exported.
"It is not only that the name Dubai is now known worldwide as a gold hub, but also the jewellery manufactured in the city," Abdullah said. "That is why we also manufacture gold jewellery for international brands here," he said.
The plant, which started production in 2007, was Emaar Industries - a unit of Emaar Properties - first investment in Dubai's lucrative jewellery industry. Emaar Industries has said it wanted to increase its presence in jewellery, with an eye on Saudi Arabia, the Arab world's largest economy.
Emaar Industries owns 52 per cent of the venture and the rest belongs to Damas.
Dubai has in recent years joined the club of a major gold trading centres such as London, New York and Hong Kong thanks to proximity to the world's biggest gold consumer, India, and an aggressive drive to become a regional commodities hub.
Family-controlled Damas - the first retail company to list on the Dubai International Financial Exchange (DIFX) earlier this month - operates in 18 countries and plans to have 569 outlets by the end of the year, up from 438 now, Abdullah said.
"Right now, our shops represent about 40 per cent of the total jewellery outlets in the UAE, and part of our expansion plan is to increase our presence here and internationally," Abdullah said, reiterating previously announced plans.
"In the UAE alone... we plan to open more than 50 new stores by the end of this year," he said.
Dubai has the highest concentration of jewellery shops in the world, generating trade worth $35 billion last year - 20 per cent of the $173 billion total global jewellery trade.
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