In the last 12 months, the country’s top two jewellery retailers, Titan and Kalyan, have each acquired an online platform — Caratlane and Candere, respectively. And the retailers are now looking to diversify their base with newer, younger customers, tapping the market for lifestyle jewellery.
Earlier this month, Kalyan Jewellers picked up the remaining 15% stake in Candere, where it was a majority holder at 85%, from founder Rupesh Jain for Rs 42 crore.
In August last year, Titan hiked its 71.09% stake in Caratlane to 98.28%. The Rs 4,621-crore deal marked an exit for founder Mithun Sacheti — one of the biggest exits for a startup founder. Titan has since increased its stake in the subsidiary to 100%.
Candere contributes 1% to Kalyan’s topline, and Caratlane 6% to that of Titan, their financial numbers for FY24 show (See chart). But the retail majors are looking to fast-track growth by tapping into an expanding base of digital-first Indian consumers who are choosing style over investment that traditional jewellery consumers, who prefer to shop at offline outlets, normally seek.
The two organised players are eyeing newer and younger consumers, analysts at Motilal Oswal said in a report this week, as the traditional gold jewellery market that gives them over 90% of their revenue remains prone to volatility. While gold prices rose nearly 14% year-on-year in FY24, they are higher now, around 19% over the FY24 average, experts said.
Research and ratings agency Icra said in a report last week that traditional gold jewellery consumption would moderate to 6-8% in FY25 from 18% seen in FY24 as gold prices continue to surge. This would in turn impact revenue growth of organised players. While organised jewellery majors saw revenue growth of about 16% on an average in FY24 thanks to high gold prices, Sujoy Saha, vice-president and sector head, Icra, expects revenue growth in FY25 to moderate to 5-9% as gold consumption growth moderates.
Online platforms, on the other hand, have seen revenue growth of an average 50-53% over the last four to five years, driven by higher digital adoption and convenience of use.
Titan and Kalyan Jewellers, say experts, want to both future-proof their businesses from the vagaries of price volatility and consumption in gold as well as finetune their omnichannel strategies as digital-savvy consumers increasingly choose to shop anywhere and are open to new styles, designs and diamond-studded jewellery.
As Titan MD CK Venkataraman said in an interaction with FE this month: “Caratlane was one acquisition we did in an area where we thought it would take us way too long to build a business, namely, an online jewellery business that targeted digitally-savvy, young women, by ourselves. Now Caratlane has become an integral part of our omnichannel strategy as digital adoption grows.”
The omnichannel pivot includes a seamless process of browsing online, free home trials, easy payments and convenient pick-ups, either at home or in stores. Refreshed catalogues every season, discounts and offers and heavy promotional activities are used to keep interest levels going.
Titan and Kalyan have also taken the Caratlane and Candere brands offline. Titan has opened over 270 Caratlane stores, while Candere has begun its offline journey recently, with 11 brick-and-mortar stores. The plan is to double Candere stores in the next two years, executives at Kalyan said. “With Candere, we are looking to explore an emerging market segment within the jewellery industry, focusing on lightweight, fashion-forward, and universally appealing designs. We believe the next phase of growth will be best captured with a significant retail presence and a strategic pivot to omnichannel commerce,” TS Kalyanaraman, MD, Kalyan Jewellers, said in a statement.
