MUMBAI (Commodity Online): Gitanjali Gems Limited (GGL), has announced its unaudited financial results for the half year ended 30th September, 2009. Driven by strong growth in the jewellery sales, particularly in the domestic market, the company registered a significant growth in net profit, despite the tight market conditions. This validates the effectiveness of cost control policies, and the bold, but calculated marketing and sales strategy adopted in this period.
Some of the highlights of the half year September 2009 result includes revenues increased by 24 percent from Rs. 2,509.63 crores for the half year ended 30th September, 2008 to Rs. 3,109.90 crores for the half year ended 30th September, 2009.
Jewellery sales went up from Rs. 1,206.9 crores in the previous period to Rs. 1,605.4 crores in the current period, representing a 33 percent growth. The share of jewellery in the total turnover went up from 48 percent to 52 percent.
The share of Indian market in the total turnover went up from 36 percent to 40 percent. Despite the economic downturn, operating profits before interest and exceptional items grew from Rs 135.47 crores to Rs. 190.16 crores representing a 40 percent growth.
The net profit for the half year stood at Rs. 98.19 crores for the period ended 30th September, 2009, as compared to the Rs. 90.41 crores in the previous period, representing a growth of 8.60 percent.
The Company has announced that it has acquired a majority stake in Spectrum Jewellery Pvt Ltd that earlier functioned as a joint venture (JV). Spectrum is the owner of the Sangini brand of diamond jewellery.
Commenting on the results, Mr. Mehul Choksi, chairman and managing director, Gitanjali Gems Limited, said, "There is a marked change in the market conditions and consumer sentiments, and despite the impact of the global recession, the Indian market appears to be improving. Our strategy to be careful, but not to miss out on any growth opportunity has been validated and the results are a clear indication that branded jewellery is increasingly finding acceptance among the Indian jewellery consumers".
The Company is looking to boost its performance both through organic growth and inorganic route like tie-ups and acquisitions, is increasing its retail presence in the Indian market, diversifying into related lifestyle retailing and continues to strengthen it's overseas presence. However, the domestic market will be the principal area of focus and the company will work towards strengthening its existing retail brands and expanding into new segments.
GGL continues to work towards optimizing production costs to improve profitability and maximize shareholder value.
