The Aditya Birla Group has announced its entry into the branded jewellery market with an investment of Rs 5,000 crore. This move allows the conglomerate to enter India’s domestic jewellery sector, valued at over Rs 6.4 lakh crore. Their new brand, ‘Indriya’, will compete with established names such as Tata Group’s Titan, Kalyan Jewellers, and Joyalukkas.
Market Dynamics and Growth Potential
Industry experts note that the migration from informal to formal sectors, consumer preference for trusted brands, and the wedding market are key factors. In FY24, India’s wedding market was valued at Rs 10 lakh crore. Kumar Mangalam Birla, Chairman of Aditya Birla Group, stated, “We have redoubled our bet on the dynamism of the Indian consumer this year, by launching two major new consumer brands — in paints and jewellery.”
Expansion Plans
Aditya Birla Group plans to establish ‘Indriya’ as one of the top three jewellery retailers in India within the next five years, targeting a CAGR of 50%. Initially, four stores will open in Delhi, Indore, and Jaipur, with plans to expand to more than 10 cities within six months. The brand will offer around 15,000 jewellery pieces, featuring over 5,000 designs.
Industry Insights
The Indian jewellery market has grown from Rs 5,04,400 crore in 2019 to Rs 6,40,000 crore in 2024. This growth is due to rising disposable incomes, more visits to branded stores, and better product offerings. A report by Motilal Oswal indicates that hallmarking and a better buying experience at organised retail outlets have boosted consumer trust.
Experts believe that rising incomes and economic growth will continue to support the market. “Rising disposable incomes and economic growth across the parameters are other factors that will drive the jewellery market,” they noted. Additionally, bridal jewellery remains a significant demand driver, accounting for 55% of the market, while daily wear and fashion jewellery contribute 30-35% and 10%, respectively.
Impact of Customs Duty Reduction
The Union Budget 2024-2025 announced a reduction in customs duties on gold and silver to 6% and platinum to 6.4%, which is expected to impact the jewellery industry. Piyush Gupta, Director at PP Jewellers by Pawan Gupta, said, “This reduction is a significant move that will not only make these precious metals more affordable for consumers but also provide a great boost to the jewellery industry.” Lower duties will reduce raw material costs, allowing jewellers to offer more competitive prices and designs, potentially increasing demand and sales.
Implications for Jewellers
Aditya Birla Group’s entry into the branded jewellery market increases competition for established players. Jewellers must adapt by improving their product offerings, leveraging brand trust, and capitalising on economic growth. The reduction in customs duties provides an opportunity to offer more value-driven products, fostering a competitive industry landscape.
