Operating income up 28 pc to Rs8998 cr
C L Jose
KOCHI/November 08-2023: The Thrissur-headquartered Jos Alukkas Group has registered a 20 per cent growth in its net profit (profit after tax) for the financial year 2022-23 (FY23) to Rs190 crore compared with Rs158 crore in the previous year.
During the same period, the operating income has logged a growth of about 28 per cent from Rs7054 crore to Rs8998 crore.
The operating income during the first half of the current financial year (FY24) grew by a modest 20 year or year to more than Rs 5,400 crore on the back of a steady volume growth and a sustained rise in gold price.
On the other hand, Alukkas Enterprises Pvt Ltd (AEPL), part of the broader Jos Alukkas Group reported a 15 per cent growth in its net profit to Rs91 crore for FY23 compared with Rs79 crore in the previous year.
During the same period, AEPL’s operating income witnessed a smart growth of more than 30 per cent growth from Rs2229 crore to Rs2905 crore.
ICRA rating agency has reaffirmed A rating for AEPL’s Rs935 bank facilities. While reaffirming the rating, ICRA has noted that the Jos Alukkas Group has consolidated its jewellery retail business in AEPL with effect from April 1, 2023 through the execution of a business transfer agreement (BTA) between AEPL and two other Group entities, viz. Alukkas Jewellery Thrissur (AJT) and Alukkas Gold Retail India Pvt Ltd (AGRIPL).
Branch expansion
Jos Alukkas Group that operates an extensive branch network of 47 branches in south India, plans to add 4-5 stores per annum over the medium term to penetrate deeper into its operating markets, particularly in Andhra Pradesh, Telangana and Karnataka, which is expected to drive the medium-term revenue growth for the group.
Though the group’s presence is spread over south Indian states, Tamil Nadu accounted for more than 50 per cent of its revenue over the last five years.
Increasing regulations in the jewellery retail industry, aimed at improving transparency and standardisation over the recent years, have accelerated the shift in the market share from unorganised to organised players. This industry tailwind is expected to benefit the organised jewellery retailers like Jos Alukkas over the medium term, supported by healthy brand equity and increasing retail presence, according to ICRA.
Restrictions on bullion imports and metal loan funding, mandatory PAN disclosure on transactions above a threshold limit and imposition of excise duty are some of the regulations that have impacted retail jewellery business prospects in the past.
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