Banks might tighten loans to jewellery sector

Owing to Winsome group default, lenders could seek higher collateral and margins

With the Winsome group (erstwhile Su-Raj Diamonds) defaulting on its loan, gems and jewellery companies might face hurdles in securing loans, as banks might now seek more collateral, as well as higher margins.

Senior bankers said the loan-to-value ratio might be made more stringent. For instance, if loan credit was given up to 60 per cent of the value of collateral earlier, now it would be for only 50 per cent.

A Gems and Jewellery Export Promotion Council official said banks had become more careful in issuing fresh standby letters of credit. After a sharp rise in defaults during the global financial crisis of 2008-09, banks had taken a cautious approach to financing units in the sector. Bank loans to the sector grew from Rs 27,477 crore in March 2008 to Rs 67,024 crore at the end of March 2013. Gross non-performing assets rose from Rs 270 crore in March 2008 to Rs 2,750 crore.

Winsome had delayed servicing its maturing letter of credit obligations by about a month, owing to the company’s weakening liquidity position due to a sudden stretch in receivables. Rating agency CRISIL had downgraded the company and some group entities to ‘D’, following the default in repayments. The company is already in talks with lenders to restructure its loans.

Compared to jewellery exporters, diamond exporters could face a bigger hurdle. As they export loose diamonds to traders abroad, these traders remain unidentified. But jewellery exports are mostly sold to retailers, which makes it easier to assure banks.

“We may take a 20 per cent higher margin against the collateral in the case of loans for jewellery exports. Banks have also become very cautious while giving out loans to diamond traders,” said a senior State Bank of India official.

Bankers and jewellery exporters expect the Reserve Bank of India (RBI) to increase the margins on gold holding, as well the amount of collateral against which the loan is taken. Rajiv Popley, director of jewellery retailer and exporter Popley Group, said banks would highlight gems and jewellery traders and seek more collateral. Earlier, too, banks were wary of lending to diamond traders; now, with RBI considering tightening the norms, it would become very difficult for these traders to avail of loans.

Currently, diamond sales are stagnant, owing to the economic instability in the US and Europe, major diamond-importing regions.
Source : http://www.business-standard.com; Sharleen D' Souza & Abhijit Lele

Old News - HIGH ON SPARKLE

HIGH ON SPARKLE

GLOBAL DESIGNS

Indian jewellery has always fascinated collectors in the West. It’s time for young designers to go across the seven seas


WHEN Premjibhai opened his showroom in Rajkot the year India regained her independence, he had no idea that his country would become one of the biggest economies in the world by the turn of the century, nor had he any inkling that small Indian jewellery design houses like his would plant their flags on foreign shores. Back in 1947, he had set up shop as Premji Valji & Sons, not far from Alfred High School, where Mahatma Gandhi studied for a while. Sixty years on, that institution is Mohandas Gandhi High School; and Premji Valji has not only opened a store in trendy Gurgaon but also set up an office on New York’s 47th Street.

Premjibhai’s success story reflects the new setting of the former jewel in the British crown. For, as his two sons consolidated the business, the grandchildren were sent off abroad to train in jewellery design. Three of Premjibhai’s four grandsons—Nilesh, Mital and Ankesh—studied at the Gemological Institute of America (GIA), while the fourth, Haresh, got a fine arts degree from Sir JJ School of Arts in Mumbai. In step

with India Inc’s great leap forward, the boys fortified themselves with the knowledge and skillsets required to take their family jewellery business to the next level.

Of course Indian jewellery designs have been in vogue for as long as there have been maharajas and maharanis, courtiers and courtesans to parade them in high society. Such was the fascination of the Indian princes and their social circle for superlative stones and settings that the best jewellers of Europe hotfooted it to India to source gems and fill up their order books. Post Independence, that motherlode obviously dried up and India went into hibernation, as far as jewellery was concerned.

Now, the great Indian middle class has come into its own too—and sent the Indian jewellery segment into a new trajectory altogether. The transition of preferences from mere weight to design, from gold to stone-studded, from traditional to fusion, has prompted not only a range of new brands but an entirely new ethos. India has come a long way from the time when its sole representative in the bleak mid-to-late 20th century years was the remarkable late Ambaji Shinde, the Goa-born jewellery designer and unknown mainstay of the House of Harry Winston in New York.

Shinde, who began working in Mumbai, initially numbered the Nizam of Hyderabad and the Maharaja of Baroda among his clients, but went on to include Elizabeth Taylor, Sophia Loren, Halle Berry and Madonna. “The appetite for understanding the exact nature of regal and old valued jewellery from India, sparked a frenzy around the turn of the century and the mystique of this led many designers like Shinde to explore the sophisticated clientele across the seven seas,” says fashion designer Raghavendra Rathore.

Cut to circa 2010. Today we have corporate rajas who promise a lucrative market, a burgeoning, well-travelled middle class with a disposable income, and Bollywood and Indian fashion making waves across the globe. No wonder Indian jewellery is enjoying a renaissance worldwide. Besides, the opening up of the Indian economy has led to a radical change in Indian consumer mindsets with increased travel, growing awareness and exposure to international designs.

People want the same standards back home that they see and covet abroad. So Indian jewellery has got a fillip both at home and abroad; the trick is to capitalise on changes. Design has gained importance, multiple pricepoints and affordability, quality control and value have all altered the way the business has functioned thus far. “Valji’s next growth phase will be driven by a global clientele,” says Ankesh Soni, director of Premji Valji, pre-empting that trend.

According to RNCOS, a leading industry research firm, with a total consumption pegged at nearly 20%, India is the world’s largest gold consumer and is expected to increase its share. Gems & jewellery exports rise

Nearly 80% of this appetite for gold is consumed by domestic sales, but exports are growing. Provisional data from the Gem and Jewellery Export Promotion Council suggests that India exported gems and jewellery worth $27.67 billion in 2009-10 — 16.67% more than the previous fiscal.

Tata group’s Tanishq, Orra, D’damas and Amrapali, besides countless smaller outfits like Sanghavi Exports and Valji have capitalised on India’s changing jewellery preferences. Take Tanishq’s Espana line, which draws inspiration from Spain’s flamenco dancing and the lure of Spanish lace. “Our designs are popular in both domestic and foreign markets. Our signature collection is mostly a travel story as people are well travelled globally and are aware of all types of cuisines and cultures,” says Sangeeta Dewan, the 33-year-old National Institute of Fashion Technology (NIFT) grad who heads design for both Tanishq and Zoya, and has an MA in Design from Milan. Ms Dewan is in big demand in the industry and even Bollywood after designing jewellery for Jodhaa Akbar and Paheli.

Rahul Kadakia, senior vice president, head of jewellery, Christie’s Americas says, “Indian clients worldwide have participated in these auctions but we also have clients from Europe and the US bidding on special items. The middle east in particular is one of our strongest clients at the sales.”

And Indian jewellery houses have responded to this dual requirement. At one end of the vibrant spectrum is Amrapali Jewels, whose designer and founder Rajiv Arora has no formal education in the field but makes superlative designs.

At the other end, the diamond brand Orra was launched in 2003 to cater to the increasing demand for Indian diamond jewellery worldwide. It has international celebrities like Julianne Moore, Nicole Kidman and Joan Rivers on board. Orra’s Rupam Singhal, deputy chief merchandising officer, “As a designer, I have to be up to date with the latest changes in the lifestyle space and consumer preferences.” But modern is not good enough for the new Indian jewellery buyer. An extra edge, an unusual touch is the demand. So contemporary is really translating into offbeat. There is more experimentation in terms of design, metals and stones to satisfy consumer appetites. Says Rahul Vira, CEO of Gili India, a leading brand in diamond jewellery, “The Indian environment has changed to a great degree. People demand things the way they see them. Contemporary designs have become the key to success.”

That’s one reason why even traditional jewellers feel the urge to be in sync. Popley Eternal, a jewellery brand that debuted in 1927, is also now looking at a more varied design ethos. “As times have changed, one has to go with the flow,” says Suraj R Popley, MD, Popley Eternal. “Earlier the inclination was more towards traditional jewellery. These days the demand is more for diamonds so we offer jewellery with combinations of rubies, emerald with diamonds, and big solitaires too. Soon we will also team sapphire and diamonds.” Those who bank on quirkiness also have a place in this new arena. Hyderabad-based designer Suhani Pittie uses quartz, pearls, copper and silver for an unconventional style statement. A graduate of the GIA, she was also the first ‘jewellery artist’ from India at the Miami Fashion Week and explains her design philosophy as juxtaposition of old and new. “I don’t like to deviate too much from culture. I connect with things that are Indian and try to contemporise it. I like to use a lot of unusual things so that it’s not run-of-the-mill stuff.” That philosophy has worked well for her. From just one store in 2004, she now supplies to 21 stores across India.

A single design can take anywhere from three days to 15 days depending on the level of intricacy, says Kiran Nair, head of merchandising, D’damas Jewellery, a joint venture between Gitanjali Gems and Dubai-based Damas Group. “India used to be only a gold jewellery market. Today lots of precious stones, diamonds and coloured stones are being used, as jewellery is now bought for diverse occasions.” Today it isn’t uncommon to find designers employed with leading brands or even working independently. Ms Dewan gives “a lot of credit” to industry bodies and institutes who recognised design as a key element for jewellery back in the 1990s.

But there is still a long way to go, design-wise. Shimul Vyas, head of lifestyle accessory design programme at NID says that India’s strength today lies more in craftsmanship and finishing. “Design still has a long way to go. A three pronged approach is necessary for the industry — jewellery that is innovation-based, concept-based and context-based. Today, the potential of design for jewellery is immense. It is gradually coming of age. But a new line of thinking is necessary for innovation to step in fully.” Now India’s jewellery legacy will finally come into its own, internationally and internally, thanks to the impetus of a new market. The late Ambaji Shinde would surely rejoice at that.




Crowning Glory: Sangeeta Dewan (right) designed jewellery for the movie Jodhaa Akbar 

Source : www.timesofindia.com; Neha Dewan 

Top jewellery companies in the world

There are many jewellery retailers in the world, but not all are famous.

Here we take a look at some of the leading jewellery companies in the world.

Click here for Rediff Realtime News!

Image: Here we take a look at some of the leading jewellery companies.

Harry Winston

Harry Winston has many stores all over the US. Their main office is on Fifth Avenue in New York City.

They offer some of the most beautiful and stunning jewellery pieces and diamond work in the industry.

Image: Harry Winston.

Buccellati

Based in Italy, but sold all over the world, Buccellati is a world famous jewellery store. They are known for their engraved pieces of jewellery with brushed gold designs that have gemstone accents and diamonds.

Image: Buccellati.

Van Cleef and Arpels

Van Cleef and Arpels is a world famous company that is known for selling luxurious jewellery items. They even have their very own secretive setting that isn't available anywhere else.

Image: Van Cleef and Arpels.

Graff

Based in London, Graff is a top quality jewellery store. They only carry the rarest and high quality diamonds and many of the pieces they sell are unique and very creative.

Image: Graff.

Tiffany and Co

Tiffany and Co, sometimes called just Tiffany's is one of the most popular jewellery stores in the entire world. Women are ecstatic when they see the Tiffany's bag or box and know they're getting high quality with any piece of jewellery purchased from the Tiffany's store.

Image: Tiffany and Co.

Piaget

If you are looking for the best store to purchase diamond watches and other specialty jewellery items, Piaget is the perfect choice.

Model Jessica Alba is helping them with their newest ad campaign to sell their jewellery in the US and Europe.

Image: Piaget.

Chopard

There are 100 Chopard stores around the world and they target the stars of Hollywood. They have some of the most unique and popular designs around the world in watches and other jewellery items.

Image: Chopard.

Bulgari

An Italian jewelry brand that is famous for Greek and Roman art inspired jewellery like gold necklaces and bracelets with large gems have been around since 1884.

Bulgari creates a new line of collections every single year and offers some of the most relevant and elegant jewellery designs out there.

The trademark is usually written "BVLGARI" in the classical Latin alphabet (where V = English U).

Image: Bulgari.

More

Mikimoto

Famous mostly for their exquisite pearl collection, Mikimoto has some of the most beautiful and high quality pearls in the world.

Image: Mikimoto.

Source : http://www.rediff.com