De Beers rough sales slide again

Anglo American said the value of rough diamonds sold by De Beers dropped to $475 million during the eighth cycle of 2018 compared to $503 million recorded in the seventh cycle.

Today

Rio Tinto’s diamond production dips in Q3 2018

Rio Tinto has announced that production in its Argyle Mines (100%) and Diavik Mine (60%) have dipped during the third quarter of 2018. Argyle witnessed a 19% dip in carat production y-o-y.

Today

GJEPC Jaipur hosts exporter interaction with bank and customs officials

The Jaipur regional office of The Gem & Jewellery Export Promotion Council (GJEPC) hosted an "Industry Interaction with Banks" on Friday, October 12 as part of its event series ‘The Dialogue - A New Beginning’, says a report in gjepc.org...

Yesterday

Angola denies abusing illegal foreign diamond miners

Angola has refuted reports that its security forces failed to observe human rights when they conducted an operation to drive out foreign illegal artisanal diamond miners in the Lunda Norte province bordering the Democratic Republic of Congo.

Yesterday

Gem Diamonds recovers 357 ct light brown stone from Letšeng

Gem Diamonds said it has recovered a 357 carat light brown ‘high quality’ diamond from its 75 percent-owned Letšeng mine in Lesotho.

Yesterday

It is all about the survival of the fittest and only those who have a long term planning and capacity will be able to make through - Sanjay Kothari

04 january 2014

Sanjay Kothari, Vice Chairman, KGK Group, based in Hong Kong is from the fourth generation of the Kothari family stepping into the business and has played a pivotal role in taking the Group to a global scale. His efforts can be witnessed across the gems and jewellery vertical of the KGK Group from mining to manufacturing and from marketing to distribution and retail. KGK now holds a team of 12,000 plus people gaining prosperity to emerge as a globally renowned group. He is also the Honorary Life President of ‘Hong Kong Gemstone Manufacturers' Association Ltd.’

When not doing business the versatile Kothari can be found admiring art and listening to music. He loves art in all forms and his favourite remains Lord Buddha. For him, Buddha not just represents truth and serenity, but also has its own mystic charm. A workaholic who loves to travel, he rates success by the ability of doing things that bring joy to your life.

KGK is known to be one of the oldest companies in the industry a century plus. Can you take us through its growth over the past century to its present status as a major diamond and jewellery manufacturer, exporter and retailer of India?

The KGK Group was established in 1905 by our Kothari family of Jaipur (India). Today, it is a global corporation with fully integrated operations in the Gems and Jewellery industry, having presence across 12 countries. A pioneer in the world of precious stones, our Group has been sourcing, manufacturing and distributing collared stones, diamonds and jewellery for decades. Completing a 100 years in 2005, KGK today is established in almost every commercial center in the world, coming closer to its customers than ever before. At present, the group is under the leadership of Shri. Navrattan Kothari as its Chairman.

The story began in 1905 with the trading of gemstones throughout India and Burma. In the 1960s, our Group positioned itself in major international business centres becoming one of the leading wholesalers of gemstones in the region. From gemstone trading, the group took on to manufacturing of nature’s most beautiful gemstones and today, KGK has gemstone manufacturing units in India, China and Thailand with marketing offices across the globe.  Emeralds, rubies, and sapphires are sourced from mines in Colombia, Brazil, Zambia, Sri Lanka, and tanzanite from Tanzania. Due to the continuous and committed efforts, our Group now has the privilege of being one of the Sightholders for Tanzanite One in Tanzania, mine owners in Mozambique and major buyers in Brazil.

KGK expanded its business in the 1970s by moving from trading of coloured gemstones to sparkling diamonds. Today the group is one of the leaders in the diamond sector with diamond-manufacturing units in India, South Africa and Russia. Resultant of the hard work and perseverance of the promoters, KGK became an authorized bulk purchaser of rough diamonds by being awarded the Sightholder status by the Diamond Trading Company (DTC), the marketing arm of De Beers. KGK’s rough diamonds are directly sourced from the mines in South Africa and from organized markets in Antwerp, London and Russia; through industry barons like DTC and ALROSA - ensuring nothing but the finest diamonds on the market.

After setting benchmarks in the gemstones and diamond sector, in the 1990s KGK expanded further adding a new vertical of fine jewellery manufacturing with establishment of manufacturing units in India, Hong Kong and China, over the years. With technologically advanced jewellery manufactured in India to the fine hand crafted masterpieces in Hong Kong, KGK offers an array of jewels to its clients, to choose from.

The group’s recent foray into retailing with its fine jewellery brand ‘Entice’ is yet another feather in KGK Group’s cap, completing the group’s portfolio from mines to the market. The fine jewellery brand 'Entice' was launched by KGK group at the turn of millennium in 2004 in Hong Kong. Following a huge success with boutiques in Hong Kong and China and with an impression that India is now modern by design, KGK launched its first boutique of ‘Entice’ in Jaipur in 2009. Latest additions are the two new exclusive boutiques of Entice New Delhi and Mumbai, launched in 2012. Entice today has 16 standalone boutiques in countries including Hong Kong, China, UAE and India.

From where do you source your raw materials from, especially rough diamonds? Diamond rough shortage has been a perpetual problem in the Indian diamond industry. How do you see the future shaping?

We source our rough diamonds from all the leading miners in the world like De Beers, ALROSA, Argyle, Rio Tinto, BHP and other organized markets in Antwerp.

Supply of rough diamonds has decreased whereas the demand of polished has increased specially in countries like India and China. The situation is interesting as only the strongly founded companies like KGK, with a great distribution network will be able to manage the balance between this demand and supply. It is all about the survival of the fittest and only those who have a long term planning and capacity will be able to make through.

What is your company’s equation with ALROSA in terms of rough procurement? Do you see ALROSA as a major rough supplier for India in the coming years?

ALROSA is one of our most important suppliers and it has become almost equivalent to De Beers in the recent years. More than one-third of the rough supplied across the globe is from ALROSA these days. KGK enjoys a great relation with ALROSA. With KGK’s diamond manufacturing units in Moscow and Gokhran, we buy a lot of rough from ALROSA and in turn provide employment and technical education to the locals of these cities in accordance with the Russian laws.

Which other untapped market/s have more potential for India as jewellery supplier? What about China, is it a threat or a potential market for Indian jewellery exporters?

The US stills holds the largest share of the Indian Jewellery exports with Japan, Europe and Russia following close. The demand of Indian jewellery in China is building up but due to the high import duties levied by their government, the situation is not too friendly for Indian jewellers. Therefore, it is too soon to comment on the appreciation Indian jewellery would get in China.

What changes have you seen in the global jewellery demand in terms of diamond, gold content, design, etc. over the years? And which according to you should be the focal point for Indian suppliers?

The demand has changed from yellow gold to white gold over the years. The fashion, world over, has evolved and with that various colours of gold like pink have also started getting appreciation. With time gold buyers have converted to diamond buyers. The US, Europe and Japan are matured markets but there is an increased demand for diamond jewellery in the BRIC nations (Brazil, Russia, India and China) and Indian jewellers should concentrate on that.

In which countries does KGK’s ‘Entice’ have currently its presence? Number of stores overseas?

Entice today has 16 standalone boutiques in countries including Hong Kong, China, the UAE and India. In India, we have boutiques in New Delhi, Jaipur and Mumbai. Another new boutique in South Mumbai is under construction and we are looking forward to present a one-of-its-kind retail space to our clients in Mumbai soon.

Has the gold import restrictions affected your manufacturing program? How important is the gold content in your jewellery meant for exports; and will silver be the ‘new gold’ in the future?

Gold is important for us in our jewellery manufacturing as it is the base metal for our jewellery, but diamond being the main focus in our jewellery, the amount of gold used is very less. The hike in gold import duties has not affected our business to a great extent; as for our business value appreciation and profit margins come from diamonds.

Silver can never be the new gold. Gold has a perception of international currency and silver can never replace that. Gold is gold.

Has the fluctuating Indian Rupee in anyway affected your company’s overall business?

The fluctuating Indian Rupee has affected our business in India only and that too for sale of jewellery in the local market and not so much in the import of rough and export of polished as there the rupee value gets balanced. But yes, the fluctuation has reduced buying capacity in the local markets. There has been a considerable increase in the prices but it will balance out over a period of time. It has already started coming to pace.

Your views on the Indian domestic jewellery sector growth over the past few years.

There has been a tremendous growth in the Indian domestic jewellery sector. This exponential growth has been due to the recent affluence amongst the middle class and increase in their spend on luxury items. The customer is converting from other commodities to diamonds and that is good for us.

Where does KGK’s strength lay as a jewellery manufacturer / retailer - a) diamond / precious colour stone couture jewellery; b) mass-made diamond jewellery; c) or coloured stone studded jewellery?

KGK is part of all the above three categories in different parts of the world but our strength lies in categories A and C, i.e. diamond / precious coloured stone couture jewellery and coloured stone studded jewellery.

KGK is one the very few companies across the globe with such a huge bank of coloured gemstones like rubies, sapphires, emeralds, tanzanites, rubelites, paraiba tourmalines and many more from our own mines as well as from other mine holders. Plus, being a sightholder of DTC and preferred partners of ALROSA add to our strengths and thus, our aim is to make unique jewellery every day.

How many stores does KGK have now in India?  Plans for the future?

‘Entice,’ the fine jewellery brand by KGK, today has 16 standalone boutiques in countries including Hong Kong, China, the UAE and India. With huge success from all these boutiques, the plans are strong and already in process.

In the KGK’s couture jewellery category which is considered an heirloom in India, how important is the diamond content versus precious coloured stones?

The diamond content is most important as it forms 90% of our jewellery. Gold is used just as a base metal and makes up to only 10% of the jewellery. We do use coloured gemstones, but very less at the moment. But, with the recent appreciation for coloured gemstones we do plan to increase its content in our jewellery.

What’s your opinion on the Government/RBI’s step to curb imports of gold, especially for the domestic sector? How do you see the gold curb panning out in due course?

As India is under a temporary financial crisis due to shortage of foreign exchange, there has been a curb on imports of gold. But, with a country where most of the population of the 1.25 billion is an investor in gold, gold is a big attraction. Sooner or later with better financial situations, the Government with hopefully decrease or abolish the curb on import of gold.

What changes have you seen in the Indian consumers’ jewellery preferences in last few years? Is diamond jewellery making a mark for itself in the local gold-loving market? What is the demand/trend in quality/size of diamonds in jewellery, in today’s domestic market?

With the evident change in the lifestyle of the Indian consumer, the jewellery has also become modernized and contemporary. Precious fashion jewellery is very much in demand and therefore, designer diamond jewellery has made its place in this gold-loving country.

India is a large sub-continent and the preferences change from north to south and east to west. Being such a large country, India is a consumer of all qualities, sizes and trends of jewellery. Where fashion jewellery and low quality works for North, high quality and classic designs work more for customers in South and East prefers more of coloured gemstones.

KGK’s “Entice” is a successful global brand. But, what is the reason for Indian brands not making a mark for themselves in overseas markets? Your views?

Indian jewellery market is not as mature as its counterparts like China and Japan. Indian jewellery lacks the finesse and the international standards of design which are easily available in jewellery from other countries. Our manufacturing skills and craftsmanship is also of lower quality to when compared to theirs and that is why it will take a substantial amount of time for Indian jewellery to catch up to overseas market and its demand.

Therefore, KGK has established jewellery manufacturing units in Hong Kong and China, from where we offer beautiful jewellery at par with international standards and that is our USP at Entice.

The Mahavir Hospital has been a great contribution to society’s welfare by KGK. Heard that KGK is entering real estate development business in a big way? What should we expect?

The KGK Group understands the importance of giving back to the community, and fully embraces the notion of Corporate Citizenship. KGK has invested an abundance of time, effort and wealth into education, healthcare and environmental rehabilitation initiatives. Foremost in KGK’s achievement is the Bhagwan Mahaveer Cancer Hospital and Research Centre in Jaipur. The ultra-modern facilities provide invaluable care, treatment and attention to hundreds of patients at a time. KGK is also the proud runner of the “KGK Wish Foundation” in Jaipur – a recognized institution that is dedicated to granting the cherished wishes of children living with life threatening medical conditions to enrich the human experience with hope, strength and joy.

Looking ahead, KGK has concrete plans to move into real estate as KGK Infrastructure and is looking forward to present iconic structures with the same finesse and creativity that have been part of KGK Group’s legacy. It aims to develop structures that are a piece of art as well as eco-friendly and sustainable buildings. The venture is envisaged to be niche; elegant and superior just like the jewels KGK Group synonymous with.

Aruna Gaitonde, Rough&Polished, Mumbai