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December 2015

Investor Presentation

Tara Jewels Limited

Tara Jewels factory


SEEPZ, Mumbai

This presentation contains certain forward looking statements concerning the Companys 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.

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 and the accompanying slides (the Presentation), which have been prepared by Tara Jewels 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.

Safe Harbour

Brand
Expansion

India Retail

International
Business

Branded merchandise

Direct Selling of Studded Jewellery to Global


Retailers

International Business

Online presence on Amazon.in & Snapdeal.com


through distributor

11 Shop-in-Shop format outlets in Shoppers Stop


19 Company Stores

Total Network of 30 Stores in 27 cities in 10 States

India Retail

SAP implemented across all units

Employs 39 designers & 1000 craftsmen

China & USA

Mumbai : 1 unit - MIDC & 2 units - SEEPZ

Manufacturing units

Manufacturing

with experience from Designing to Retailing

Manufacturing

Designing

Integrated Player in the Jewellery Industry

Collaboration with wedding planners

Asset Light Retail Partner Model

P New Expansion by way of

P Improving Profitability

P Limited Capital Allocation

P Strong Branding efforts lead to


enhancement in Margins

P Growing Cash Generating Business

Future Strategy

....Limited Capital allocation to Retail and Improving Margins in Exports

Online with Amazon and Snapdeal

19 Operating Format Stores

11 Shop-in-Shop format outlets in


Shoppers Stop

Total Network of 30 Stores in 27 cities in


10 states

Retail Business

Framework Orderbook : Rs. 941 mn

Confirmed Orderbook : Rs. 4,408 mn

Combined Orderbook of Rs. 5,349 mn

Good Traction New Customer,


Geographies, SKUs & Brands

Exports Business

Business Strategy going forward...

International Business

Indian Export Industry

Dominated by Diamond processing & polishing,


followed by Gold Jewelry

Wholesalers

NA

Products

Customers

Branding

Majority Indian Exporters

Job Work

Parameters

Rough Diamonds

Processed
Diamonds

Tara Jewels- Operating in The Sweet


spot in the Jewelry Value Chain

High End
Luxury
Jewelry

Tara Jewels Presence

Co-brand merchandise to increase brand recognition & repeat


orders

Large Retailers Wal-Mart Inc, JC Penny, Zale, Ernest Jones,


H.Samuel, Helzberg etc

Diamond studded jewellery, studded jewellery

Where we are positioned

Jewelry

Branded Jewelry

Gems & Jewellery Value Addition Ladder

Presence in High End of Value Chain

U.S.A.

South Africa

Europe

U.K.

India

China

Russia

New Zealand

Australia

Promoted over 8 brands globally across 7,000 doors Worldwide

Canada

Global Presence

H Samuels

No. 1 Specialty Jeweller


in UK

QVC

Ernest Jones

No. 1 Upper Middle


Market Jeweller in UK

Blue Nile

Leading Broadcast
Television Network in US

No. 1 Specialty Jeweller


in US

Largest Departmental
Store in US

No. 1 Online Specialty


Retailer of Jewellery

Kay

Walmart

Leading Regional Dept


Store in South Africa

Sterns

Speciality Retailer of
Fine Diamond Jewellery

Helzberg

No. 2 in Specialty Retail


jewellery chain in US

Zales

Leading Jeweller in
South Africa

American Swiss

One of biggest Mid-range


Department Store in US

JC Penney

No. 1 Off-mall Destination


Jeweller in US

Jared

Across various Segments and Geographies

Heat Essence is currently being sold in speciality jewellery stores in US


The Zac Posen Collection is being sold by one of the largest online retailers and
high-end jewellery chain stores
With brands ZAC Zac Posen in fashion, Truly Zac Posen in bridal wear
The Angel Sanchez Collection is being sold by the one of the largest specialty fine
jewelry companies in US and UK

Cherished Hearts is being sold by one of the biggest mid-range department store
in US

Heart2Heart is being sold by one of the largest departmental store in US

Strategically aligns our offerings with Clients Business Model

Facets by Michael Beaudry is being sold through Broadcast Television Network


and high-end jewellery chain stores

The Monique Lhuillier Collection is being sold through one of the largest online
retailers
Considering sale through high-end jewellery chain stores

International Brands

International Brands
Our Brand tie-ups available on:
www.bluenile.com
www.helzberg.com
www.kay.com
www.amazon.in
www.snapdeal.com

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* Sales Value of the End Customer

Key Retail Customers

Retail
Jewellery
Sales

$1,000
$1,900
$2,300
$1,200
$218
$241

Stores

4540
1600
1094
253
196
302

$13.93m

$60.24m

$20.86m

$56.10m

Tara
Jewels
End Sales
FY2015 *

Huge Growth Potential

240

175

NA

1,020

234

Stores

$740

$430

$474

$500

$700

$2.88m

$8.86m

$11.31m

$14.74m

Tara Jewels
End Sales
FY2015 *

with Key Existing Customers

Key Retail Customers

Retail
Jewellery
Sales

Sales in USD mn

11

Confirmed Orders

4,408

Framework Orders

941

* Framework Orders - Contracts where Metal Prices are yet to be finalized

Order book as on 30th Sep 2015; 1 USD = Rs. 65.5

(Rs. mn)

Combined Order Book

Current Order Book

Combined Orders

5,349

12

H1FY16

H1FY15

177

956

H1FY15

575

78

Quarter Ended Quarter Ended


Sep. 14
Sep. 15

93

544

H1FY16

EBIDTA

Creditor Days (Sales)

H1FY16

881

Gross Profit

H1FY15

Quarter Ended Quarter Ended


Sep. 14
Sep. 15

178

Inventory Days (Sales)

5,777

6,079

Sales

H1FY16

126

Quarter Ended Quarter Ended


Sep. 14
Sep. 15

122

149

Debtor Days (Sales)

H1FY15

166

PAT

International Business: H1 FY16 Performance

13

Rs mn

H1FY16

H1FY15

3.5%

1.7%

3.4%

H1FY16

1.4%

1.2%

H1FY15

5.8%
1.0%

6.3%

Employee Cost

Admin Cost

Selling & Distribution Cost

Operating Cost

100% of revenue generated from International Business is from Diamond


Studded Jewellery

9.4%

9.5%

EBITDA Margin

International Business: Margin Analysis

14

FY11

9,234

FY13

FY14

FY15

14,444 15,024

FY11

1,484

FY13

FY11

FY12

140

139

156

FY14

142

FY15

113

Inventory Days (Sales)

FY12

11,335

13,292

Sales

FY12

1,701

FY13

1,850

FY15

2,155

FY11

851

FY11

86

FY12

111

FY13

63

FY14

92

FY15

68

FY12

FY13

1,228

FY14

1,322

EBITDA

1,071

Creditor Days (Sales)

FY14

2,110

Gross Profit

FY11

355

FY12

420

FY13

587

PAT

62

FY12

100

FY13

77

FY14

94

128

FY14

432

FY15

Debtor Days (Sales)

FY11

FY15

1,391

International Business: Annual Performance

FY15

426

15

Rs mn

FY15

FY14

2.95%

FY15

3.13%

FY14

0.91%

5.09%

Employee Cost

1.22%

Admin Cost

1.01%

1.31%

5.45%

Selling & Distribution Cost

Operating Cost

100% of revenue generated from International Business is from Diamond


Studded Jewellery

9.26%

9.15%

EBITDA Margin

International Business: Annual Margin Analysis

16

India Retail

17

Build...

Re-Engineer...

Redefine ...

a blend of Cultural Influences with Global Trends

Special Confidence Building Programs

Customers upgrade from Gold to Diamond Jewellery

Give adequate knowledge about Diamond Jewellery

... the Customer Confidence

In-store workshops for jewellery servicing

Introduced smaller, full-service format stores for stocks to reflect customer


preferences

Best practices from International Retail

... the Store Format

Made to Order - Design personalized Jewellery based on Unique Personalities

Allows the customer to browse through collections

Purchases more Transparent & Credible

... the Jewellery Purchase Experience

Changing Jewellery Retail Experience

18

CAD / CAM

State of the art technology: Laser Lithography, Microscopic Precision Setting, Machine made bands, Invisible
Settings (patented), Machined Engraving

Fully automated jewellery casting plant

High precision jewellery manufacturing technology

Store Concept & Marketing Skills

Varied Market Insights

Creating Global Fashion & Trends

Implementing the learning from the more matured Global Retail Leaders

Experienced Supplier to the Large Global Retailers

Learnings from Multi-Industry Exposure being transcreated to Jewellery Retail

Benchmark Marketing & Branding case studies created across market segments

Strong Consumer Connect demonstrated across advertising, Media, Fashion and Luxury

Jewellery Retail Chain Orra was launched in 1998

Rose International was conceptualised in 1981

Strong Promoter / Management background in Retail & Branding

Drivers of Success

19

Smart, Scalable & Sustainable

Collaboration with wedding planners participating in bridal


events and wedding magazines

Presence on Amazon.in and Snapdeal.com through distributor

In tune with changing consumer behavior

Average ticket size of Rs 50,000

Affordable luxury with Great Value

Targeting the untapped Aspiring Indians at base of the Pyramid

Jewellery displayed on Browse Walls, Collection Walls and


Consultation Tables

Scalable Format of Small Full Service Stores

Span across suburban areas of metro cities, mini metros and Tier I
III cities

Network of 30 Stores including 11 Shop-in-Shop format outlets in


Shoppers Stop spread over 27 Cities in 10 States

Pan India Presence

Our Retail Business Model

20

Operational

Strategic

Asset Light Model

Streamline the Store Operations and


Manage the Unit Economics

Expand the Brand more rapidly

Achieve Faster Expansion & Better Returns

Small Format Stores - Limited Inventory and


Operating Costs

Widen Presence in Tier II V Cities

Store Profitability

Product Mix

....to maintain Profitable Growth

Shop-in-Shop

Limited Operating Costs - Benefits from


store advertising & promotions, Low Staffing
Cost etc

Captures footfalls of Malls/Large Stores

Lower Inventory Requirement

Reduce the sale of plain Gold Jewellery

Diamond Jewellery, Kundan Jewellery


and Make to Order Jewellery

Focus on High Margin Products

Re-strategizing the Retail Business

21

Elante Mall-Chandigarh

BPK Star Building Indore

World Trade Park - Jaipur

MBD Neopolis Mall Jalandhar

DB City Mall Bhopal

Ambuja City Center Raipur


Alpha One Mall Amritsar
Prozone Mall Aurangabad
Eros Mall Delhi
The Great Indian Place Noida
Inorbit Mall Vashi, Mumbai

....in line with out strategy to expand retail footprint through Asset Light Model

Lower Inventory Requirement


Captures footfalls of Malls/Large Stores
Limited Operating Costs - Benefits from store advertising & promotions, Low Staffing Cost

Location :

Total of 11 Outlets in Shop-in-Shop Format


Outlets at Shoppers Stop

Asset Light expansion Strategy

Retail Business expansion Shop in Shop Format ..

22

logistic capabilities

Wide spread penetration & Amazons strong

Easily adapt to the changing buying behaviour

No Establishment and Limited Operating Cost

Launched Unique jewellery collection Anisa, a


range of rings and earrings

Collection ranging from daily wear, signature


collections such as Heart Embrace & Fleur to
International Bestsellers

The distributor of Tara Jewels has tied up with


Amazon and Snapdeal to launch the brands
collection online

Asset Light expansion Strategy

....in line with out strategy to expand retail presence through Asset Light Model

E-Retail

23

CAD shown to
the customer in
48 hours

Large design
bank

Resin prototype
of the jewellery
through CAM

Resin
Prototype

Wax replica
provided to the
Customer

Wax Mould

Final Product
Final product
delivered in 14
days

Made to Order constitutes ~30 % of India Retail Business

CAD

Designing

High Value and Higher Margin Business

Jewellery Customization

24

H1FY16

804

171

183

H1FY15

101

Quarter Ended Quarter Ended


Sep. 14
Sep. 15

33

108

106

H1FY16

EBIDTA

Creditor Days (Sales) *

H1FY16

* Gold now acquired under gold on loan scheme

Quarter Ended Quarter Ended


Sep. 14
Sep. 15

200

275

Gross Profit

H1FY15

Inventory Days (Sales)

H1FY15

902

Sales

India Retail: H1 FY16 Performance

H1FY16

21

Quarter Ended Quarter Ended


Sep. 14
Sep. 15

Debtor Days (Sales)

H1FY15

10

PAT

25

Rs mn

43

Diamond

H1FY15

11.2%

38

H1FY16

H1FY15

5.8%

8.7%

4.8%

19.3%

Selling & Distribution Cost

H1FY16

3.5%

5.2%

9.6%
1.0%

Admin Cost

Operating Cost

Asset Light Model drives better margin

H1FY16

13.1%

EBITDA Margin

H1FY15

10

Gold

Margins (%)

India Retail : H1 FY16 Margin Analysis


Employee Cost

26

Financials

443

Q1 FY16

2,656

International

Revenue Breakup

361

Q2 FY16

3,121

Retail

-19%

+17%

Rs Mn

28

International
Business
88%

* - Excluding Bullion & Others


^ - Gross Profit = Sales (Consumption + Direct Expenses)

India Retail
12%

H1 FY16 Sales: Rs. 6,581 mn

Segmental Breakup*

India Retail
17%

International
Business
83%

H1 FY16 Gross Profit^: Rs. 1,064 mn

29

369
369
9.6%
12

332
332
9.5%
13
182
53
111
36
74

EBITDA

- EBITDA excl. Bullion & Others


- EBITDA Margin excl. Bullion &
Others
Other Income

Interest

Depreciation

PBT

Tax

PAT

2.7%
175

2.1%
127

PAT Margin

Cash Profit

260

2.2%

63

209

113

353

26

9.9%

650

650

409

229

5,294

6,581

6,581

H1 FY16

147

-27%

-22%

-10%

-10%

Y-o-Y

106

36

142

69

169

278

237

Other Expenses

129

114

3,075

3,851

Employee Expenses

2,797

Raw Material

Purchase of Bullion & Others

3,481

Total Income

3,851

3,481

Sales

Sales from Bullion & Others

Q2FY15

Q2FY16

Rs. mn

Consolidated Quarterly P&L

308

2.5%

176

72

247

132

320

23

9.7%

676

677

526

256

72

5,522

7,053

72

6,980

H1 FY15

-16%

-15%

-4%

-6%

Y-o-Y

30

716
281
643
206
437
2.5%
717

Depreciation

PBT

Tax

PAT

PAT Margin

Cash Profit

9.3%

- EBITDA Margin excl. Bullion & Others

Interest

9.4%

1,585

- EBITDA excl. Bullion & Others


53

1,570

1,586

EBITDA

Other Income

1,576

986

Other Expenses

719

3.0%

504

260

764

215

651

54

1,210

563

530

181

13,424

Employee Expenses

13,962

Raw Material

16,954

289

17353

Total Income

187

Purchase of Bullion & Others

2,90

16,767

17,063

Sales

Sales from Bullion & Others

FY14

FY15

Rs. mn

Consolidated Annual P&L

0%

-13.3%

0.9%

0.6%

1.8%

Y-o-Y

31

5,846

5,992
246
5,734

Shareholders Fund

Share capital

Reserves & Surplus

514

Other current liabilities


13,503

2,415

Trade Payables

Total Liabilities

4,509

59

Other Non Current Liabilities

Short term borrowings

14

Long term borrowings

7,437

73

Non-Current Liabilities

Current Liabilities

12

Money received against share


warrants

13,446

435

3,017

4,097

7,549

48

51

12

5,587

246

March
2015

Rs. mn

September
2015

821
242

Cash and Bank Balances


Other current assets

13,503

4,798

Trade receivables

Total Assets

6,428

Inventories

12,289

40

Long-term loans & advances

Current Assets

46

40

1,088

1,214

September
2015

Deferred tax assets (Net)

Non-current investments

Fixed assets

Non-Current Assets

Rs. mn

Consolidated Balance Sheet

13,446

262

835

5,337

5,764

12,199

42

39

37

1,129

1,247

March
2015

32

Public &
Others
19.4%

Promoter &
Promoter
Group
60.1%

FII
2.7%

Foreign
Corporate
Bodies
8.4%
DII
2.8%
Bodies
Corporate
6.7%

Shareholding Break-up Category wise

DB International (Asia) Ltd

Total

ICICI Prudential Balanced Funds

Sharekhan Ltd

13.74

1.94

2.11

1.16

7.31

Crystalon Finanz AG

1.22

Intime Equities Ltd

Name of the Shareholder

Sl. No.

Shareholders holding more than 1%

Shareholding as on 30th September 2015

33

SHANTI KHINDRIA

RAJEEV SHETH

NIKKHIL VAIDYA

SANJAY SETHI

FERN MALLIS

RAKESH KALRA

MARIANO DE LA TORRE

Board of Directors

FRANCOIS ARPELS

RAVINDRAN M.P.

RAJIV JAIN

1981

Rose
International
1989

1996

Key Milestones

Received award for the largest exporter for 12 years running

Only Indian Director of jewellers Board of Trade, USA

Introduced concepts like flexible manufacturing units and turntable technology

Set up one of Indias first diamond jewellery retail chains currently called Orra

Promoter and managing director of Intergold India Limited from 1989 to 1999

1999

Started his career by promoting Rose International, high-end luxury jewellery boutique
in 1981

Certified gemologist from Gemological Institute of America, USA and bench jeweller
trained in USA and Japan, practiced this art for 9 years

Rajeev Sheth, a first generation entrepreneur, with over 32 years of jewellery


manufacturing & retail experience

Promoter Background: Rajeev Sheth

2001

35

Yogesh Sharma
GM Materials

GM - Finance

Nivedita Nayak
CS & Compliance Officer

Sunayana Vora
Vice President Sales

VP - Business Development (Exports)

Vishal Adhyapak

GM Information Technology

Fabrikant Tara International


LLC

International Business

Retail Business

GM Human Resources

Chander Gurnani

Aarti Sheth Cooper

Vice President Sales

Stuart Marcus

Chief Operating Officer

Ambica Singh

Nilesh Agashiwala
Chief Financial Officer

Leonard Meyer
President Sales (South Africa,
Australia, UK)

Jeffrey Shlakman
President Merchandising & Product
Development

Pravin Patil

GM Accounts

Jayendra Rane

Vice President Diamond Procurement

Senior Vice President Operations

Chief Operating Officer

Sajid Salim Sakarwalla

Tateos Tateossian

Ravindran M. P.

Experience of more than 30 years with various leading Indian and MNC organisations

Chartered Accountant by profession and graduate in commerce from Mumbai University

Responsible for planning and Control of Finance & Accounts function

Chief Financial Officer

Bimal Desai

Management Team

36

Awards & Achievements

Conferred with the status of a Star Trading


House by the Ministry of Commerce & Industry
and have been the highest exporter in gems and
jewellery sector for the years FY2009 and FY2010.

Overall Excellence award : Second-highest


exporter in the category of studded precious
metal jewellery exports in EPZ, by The Gem and
Jewellery Export Promotion Council in year 2007,
2008, 2009

Global Supplier of the Year : Twice Awarded by


Wal Mart

International Business

The Global Supplier of the


Year Award for 2007 from
Wal-Mart.
The second highest exporter
of studded jewellery for the
year 2007 - 2008
The second highest exporter
of studded jewellery for the
year 2008 - 2009

38

Second Highest Net Foreign


Exchange Earner Award for
2007-2008

Highest Export Performance


Award for 2007 - 2008

Second Highest Net Foreign


Exchange Earner Award for
2008-2009

Highest Export Performance


award for 2008 - 2009

"Highest Net Foreign


Exchange Earner Award
for 2009 - 2010

Highest Export
Performance award for
2009 - 2010

The Best Store Design of the


year Single Brand category at
the ET Retail Awards 2013

Awarded LUXURY RETAILER


OF THE YEAR at the Star
Retailer Awards 2013

Print campaign of
the year 2012

Nominated for the Best 360


Marketing of the year 2012

India Business

ET Retail Award

39

Investor Relations Advisors :

Strategic Growth Advisors Pvt. Ltd.


CIN: U74140MH2010PTC204285
Ms. Ruchi Rudra / Ms. Payal Dave
rruchi@sgapl.net / dpayal@sgapl.net

www.sgapl.net

Company :

Tara Jewels Limited


CIN: L52393MH2001PLC131252
Mr. Sanjay Sethi, Director-Finance
sanjay.sethi@tarajewels.co.in

www.tarajewels.in

For further information, please contact:

40