Dubai: India-based Kalyan Jewellers plans to set up a jewellery design and manufacturing unit in Dubai which would supply company’s own stocking requirements as well as be offered to the wholesale trade in the UAE. The new capacity will also be utilised by Kalyan’s fast — expanding retail network in the Gulf and, beyond that, key Far East markets such as Malaysia and Singapore.
A location at the Dubai Multi Commodities Centre (DMCC) free zone is the obvious choice. A team has been assigned to work on the location and plant requirements. Once a decision is taken, it will take six to eight months for the plant to be commissioned.
“It will be among the largest in the region, with more than 200 people working and 5-8 kilograms of jewellery being processed daily,” said Ramesh Kalyanaraman, executive director. “There will be limited scope for actual refining as little of the metal we would receive here is ‘old gold’” unlike in India.
“The future is about jewellery making and making sure the right designs are flowing into the retail marketplace at the right time.”
Investments on the plant would be the in region of Dh250 million and comes on top of a Dh250 million outlay on a six-store network which came into being in the UAE in January. At the time, the retailer brought in Indian Bollywood superstar, Amitabh Bachchan (he also appeared in ‘The Great Gatsby’), and other actors for the glitz-heavy openings. In the two months, the retailer sold more than 1 tonne of the metal in its many forms and is looking to maintain the volumes for the full year.
In addition, there is to be a further Dh250 million to add a further seven stores, two more being in the UAE and the rest in the GCC. (Saudi Arabia does not figure in the expansion plans at this stage.)
The intention with the plant and an aggressive retail rollout is to have Dubai as the hub for all of Kalyan’s international operations by 2015. By then, the target is to achieve 30-35 per cent of the group’s turnover from overseas interests. (In the 12 months to March 31, the company’s financial year, revenues are expected to cross Rs100 billion for the first time. Kalyan operates three “small” jewellery making units in India.)
A definite date on the plant launch in Dubai will be taken once clarity comes about on India’s requirement that its domestic jewellers should export 20 per cent of their bullion offtake. “Gold is not easily available in India with all the government restrictions … meeting the 20 per cent is thus necessary for the big Indian jewellery firms and thus make sure the other 80 per cent is also available,” said Kalyanaraman. “But as soon as the 80:20 requirement is changed, we will ready with the Dubai plant plans. Even otherwise, there will be a plant in Dubai, which is going to be the group’s second home so to speak.”
