PC Jeweller Investor Presentation December 2016 Safe Harbor This - PowerPoint PPT Presentation

PC Jeweller Investor Presentation December 2016

Safe Harbor This presentation and the accompanying slides (the “Presentation”), which have been prepared by PC Jeweller Limited (the “Company”), have been prepared solely for information purposes and do not constitute any offer, recommendation or invitation to purchase or subscribe for any securities, and shall not form the basis or be relied on in connection with any contract or binding commitment whatsoever. No offering of securities of the Company will be made except by means of a statutory offering document containing detailed information about the Company. This Presentation has been prepared by the Company based on information and data which the Company considers reliable, but the Company makes no representation or warranty, express or implied, whatsoever, and no reliance shall be placed on, the truth, accuracy, completeness, fairness and reasonableness of the contents of this Presentation. This Presentation may not be all inclusive and may not contain all of the information that you may consider material. Any liability in respect of the contents of, or any omission from, this Presentation is expressly excluded. This presentation contains certain forward looking statements concerning the Company’s future business prospects and business profitability, which are subject to a number of risks and uncertainties and the actual results could materially differ from those in such forward looking statements. The risks and uncertainties relating to these statements include, but are not limited to, risks and uncertainties regarding fluctuations in earnings, our ability to manage growth, competition (both domestic and international), economic growth in India and abroad, ability to attract and retain highly skilled professionals, time and cost over runs on contracts, our ability to manage our international operations, government policies and actions regulations, interest and other fiscal costs generally prevailing in the economy. The company does not undertake to make any announcement in case any of these forward looking statements become materially incorrect in future or update any forward looking statements made from time to time by or on behalf of the company. 2

The world of PC Jeweller A Leading player in Established in 2005 today the 2 nd Largest Indian Wedding Jewellery Market listed jewellery retailer in India Featured in the list of 20 fastest growing Luxury Goods companies across the world Alongside: Pandora, Fossil, Graff Diamonds, Michael Kors, etc . #44 in the Top 100 Luxury Goods Companies Globally – Deloitte report Source: Deloitte – Global Power of Luxury Goods 2016 3

Our DNA build for performance… Grown from 1 showroom in Karol Bagh (in 2005) to 68 showrooms today  Focussed on Tier I & Tier II locations to leverage the income growth and brand awareness in such locations  Consistently innovating in terms of designs, product ranges and leveraging technology Committed to our principles And combining Key Elements  Hedging Gold and Currency since initial years  Continuously enhancing design team and  Ability to have a long term vision and plan expand manufacturing facilities to ensure we ahead are ahead of competition in terms of designs  High Growth ambitions tempered with and cost efficiency conservatism  Focus on diamond jewellery and wedding  Risk taking qualities with stop-loss mind set jewellery 4

…Leading to fastest growth since inception Wearyourshine.com “#2 largest listed jeweller in India in a span of 10 years” 3 Franchisee Store 5 Small Format Wearyourshine.com Store 60 Large Format 60 Large Format Store Store 24 Large Format 10 instore 10 instore Stores 1 Large Exclusive Lounges Exclusive Lounges Format Store CAGR FY06 FY12 FY16 As on Date Sales (Rs Crs) 3,042 7,259 24% EBIDTA (Rs Crs) 332 754 23% PAT (Rs Crs) 230 401 15% 5

An Overview

In a Changing Market Scenario Earlier Changing trends Present Unorganised - Organised - Local Jeweler Brands and Hallmark Rising Incomes Increasing regulations Highly Unregulated by the Government Silver & Gold Gold & Diamond Jewellery Jewellery Preferences Key Drivers Changing Investment Investment + Fashion (Store of Value) Fashionable & Traditional Designs Innovative Designs Favorable Demographics Largely for Also Wearability and Marriage & Festivals Gifts 7

Along with increasing Regulations by the Government Governmental initiatives driving towards an organised market  Mandatory PAN card on transactions above Rs. 0.2 mn  Compulsory Hallmarking of Gold Jewellery Initiatives  Levy of 1% excise duty – aim to in the last control illicit trade practices few years  Demonetisation of higher currency notes Key Benefits  Regularising the industry to the  Increasing Transparency Industry 8

We stand apart with our offerings… Large Format Showrooms At high street in the city  Trust and  ‘Trust’ to customers seeking one -stop for Ambience wedding jewellery products Large Larger variety across price range  Variety  Much wider than its competitors Lower making charges on ‘comparable’  Intelligent products Pricing  High margins on unique, designer and exclusive pieces  7 days returns policy Customer Buyback policy  Friendly Flagship Store at Karol Bagh, New Delhi Lifetime free Service  Policies  Karat-meters at all showrooms 9

We stand apart with our offerings… Format Store Reach Target Audience To innovate and target newer markets  Ideal location for such stores is busy local  markets which primarily have unorganized Target middle class/ lower middle class  Small Store 1,000 - 1,500 players customers Format sq. ft. Already opened 5 stores under this format till  Target cities where PCJ has a strong brand  date recall and a presence on high street Smaller Cities, Tier II - III cities do not require  To innovate and target newer markets  Franchise 1,500 - 3,000 significant inventory levels  Target middle class/ lower middle class Showrooms sq. ft. Already opened 3 stores under this format till  customers date  Launched in 2015 as a curated jewelry Growing Work Wear/ Daily Wear jewelry  platform WearYourShine. E-commerce segment  Helped in developing effective marketing and com website  Targeting future wedding jewelry communication and targeting strategies for customers at an early age both online and offline stores 10

We stand apart with our offerings… Format Store Reach Target Audience Launched in November 2014  Unique detachable jewelry collection  Range  PCJ Stores catering to youngster, working women and Branded Rs. 1,00,000 and above  young couples Jewellery – & Light-weight Flexia (Rs. 25,000+)   To have presence in SIS format across ‘ Flexia ’ SIS Model  Focus to create an independent sub-brand Malls and Airports (Primarily Metros and Tier 1) Limited capital, with high visibility and  customer reach for the brand PCJ & Other Acquired from World Gold Council  Branded Luxury Looking to leverage this brand to further  Jewellery –  Target- modern Indian brides Jewellery enhance our strength in high end wedding ‘ Azva ’ stores jewellery market 11

A Class Apart in Design… Leading player in Wedding Jewellery (70% of Indian Market Demand) Policy of incentivising top A strong design team with designers leading to higher over 50 designers retention rate Global reach with Global State-of-Art Manufacturing brands – ‘ Azva ’ Facility 12

…With PAN India Presence… Key Brand Strengths  68 showrooms (3,74,481 sq. ft.)  54 cities and 18 states  Exclusive lounges at 10 showrooms Map not to scale 13

…Vertically Integrated Operations… Strong Risk Robust Supply Research and Manufacturing Management Chain Design 5 manufacturing In-house design   Gold on Lease Seamless Supply Chain   facilities with modern to ensure minimal WIP  Participation in fashion equipment Insured inventory  inventory and a rapid shows and exhibitions store rollout Strong Security Systems  Skilled pool of workers   Focus on original design Efficient inventory   Rigorous internal audit and innovation management process – system quick rotation of stock Advantages of own Launches new  manufacturing unit:  Physical verification of collections regularly Centralized raw  complete inventory at material Procurement Capture margins across Launched a unique   regular intervals and store set-up value chain detachable jewelry collection, Flexia  Transportation of raw Quick response to shifts  material and finished in consumer good through third preferences and new party carriers with launches transit insurance  Control over design secrecy, quality of raw materials and finished goods 14

We are Future Ready

Increasing affordability of Aspirational Indians… India’s population of ultra-high-net-worth is growing at an ~65% population impressive rate below the age of 35 years Wealth Millennials The four key elements of Consumption Growth M-commerce will be the fastest growing Digital segment of internet Travel luxury retailing Spend by people travelling accounts for 40% of the personal luxury market 16