PE firm Creador affiliate Idria invest Rs 135 crore in PC Jeweller

25.02.15 / Author: T E Narasimhan, Business Standard

Idria, an affiliate of Creador II LLC, has invested Rs 135 crore for a minority stake in publicly listed PC Jeweller. This is the 15th investment (sixth in India) for Creador, a private equity firm focused on long-term investments in growth-oriented businesses in southeast Asia.

PC Jeweller, incorporated in 2005, has 50 showrooms across 42 cities in 17 states. The fund infusion will back the company’s plans to open 20 showrooms every year over the next five years.

“Over the past 10 years, PC Jeweller has developed excellent service standards with several unique customer value propositions. It provides a wide range of gold and diamond jewellery at competitive prices, keeping the customer buying behaviour in mind,” Creador stated.

PC Jeweller also exports hand-made designer jewellery. It recently ventured into e-commerce with to tap the youth segment and impulse purchases.

PC Jeweller reported 46 per cent compounded annual growth rate in profit after tax between financial years 2010 and 2014, driven by an increasing proportion of domestic sales and diamond mix. It has an average ROE of 34.7 per cent over the last five years. The company is planning aggressive growth in Metros, Tier I and Tier II towns with a target of opening 20 new showrooms every year over the next 5 years.

Anand Narayan, Senior Managing Director of Creador Advisors India said, “PC Jeweller, under the leadership of Balram Garg, is an exceptional company experiencing a phenomenal growth rate. As the organised share in jewellery retail increases, PC Jeweller is bound to benefit from this trend and we are delighted to have this opportunity to partner with Balram and his team in shaping its next phase of growth.”

Jewellery purchase is rapidly moving from unorganised and standalone stores to large format organised chains. Traditional designs are also being replaced by innovative and contemporary patterns. As it is a high involvement purchase, product quality, trust in the brand and consistent service across outlets are important success factors.