Motisons Jewellers Ltd Management Discussions

INDUSTRY OVERVIEW

The Gems and Jewellery ("G&J") industry is a broad spectrum industry consisting of varied activities, like manufacture and trading of jewellery consisting of gold jewellery (with varied purities of 22 kt, 18kt & 14 kt), diamond & gem stones studded jewellery and processing of rough diamonds to create cut & polished diamonds. In India certain varieties of traditional jewellery like Polki, Kundan etc. continue to be worn at special occasions mainly weddings.

In addition, silver jewellery, has gained much popularity in recent times due to its variety of designs as well as affordability. The G&J industry continues to remain dependent upon the capabilities of artisans who continue to bring out the magic by their skills. The majority of jewellery in India continues to be handmade though the use of machines is now increasing in the cutting & polishing of diamonds. India is deemed to be the hub of the global jewellery market because of its low costs and availability of high-skilled labour. The skills of Indian karigars has ensured that it remains the top most country in the world in the field of handmade gold jewellery as well as cutting and polishing of diamonds.

The G&J industry plays a vital role in the Indian economy as it is one of the largest exporters of the country and also provides employment to a very large number of artisans.

Indias jewellery market is among the largest globally, valued at approximately USD 70 billion as of 2025. The sector is highly heterogeneous, encompassing gold, diamond, platinum, and other precious and semiprecious jewellery. Traditionally dominated by gold jewellery, the market is witnessing increased demand for diamond and contemporary designs, especially among younger consumers.

The market remains largely fragmented, with organized retailers accounting for a growing share but still facing stiff competition from unorganized players, particularly in Tier 2 and Tier 3 cities and rural areas. As of 2025, nearly 50% of the retail market remains unorganized, representing a significant opportunity for branded players to expand their footprint.

As per rough estimates there are almost half a million jewellery retail outlets across the country. Retail jewellery shops are present in every nook and corner of the country. However, majority of these outlets are in the unorganized segment though the share of branded jewellers is increasing steadily. Many organized jewellers are now expanding their operations from a single store to become a multi store chain. As in many other sectors in jewellery also the concept of becoming a franchisee of an established brand is also catching up. This provides the brands an opportunity to expand in an asset light manner.

The strong domestic chains are also opening stores overseas, especially in the Middle East, which has a sizeable Indian diaspora as well as sizeable demand (especially of gold jewellery) from local population as well. In addition there is a demand for traditional jewellery from NRIs all across the world, which is met through exports.

DEVELOPMENTS

Cumulative FDI inflows in diamond and gold ornaments in India stood at Rs. 8,905.18 crore (US$ 1,427.39 million) between April-December 2024.

Some of the key developments in this industry are listed below

The India-UK Free Trade Agreement is expected to more than double Indias Gems & Jewellery exports to the UK, reaching Rs. 21,183 crore (US$ 2.5 billion) within the next two years.

In June 2024, Union Minister of Commerce and Industry Mr. Piyush Goyal commends Bharat Ratnam - Mega CFC, a project by the Gem & Jewellery Export Promotion Council (GJEPC) and SEEPZ, for enhancing the Aatmanirbhar Bharat vision.

In January 2024, Prime Minister Mr. Narendra Modi inaugurated the commencement of the Bharat Ratnam Mega CFC at the SEEPZ SEZ in Mumbai in virtual mode (remotely). Bharat Ratnam Mega CFC is a Socio-economic project promoted by the Ministry of Commerce and Industry, GJEPC India and SEEPZ SEZ authority to drive exports from the country. This project aims at creating a world-class infrastructure for promoting the inherent skills of the Gems & Jewellery manufacturing industry. The Mega Common Facilitation Centre provides a supportive and collaborative environment for entrepreneurs, MSMEs and small businesses to grow and thrive.

In September 2023, The Gem & Jewellery Export Promotion Council (GJEPC) has achieved a significant milestone by facilitating Indias first jewellery exports through courier mode from Mumbai. This development represents a significant leap forward in simplifying international trade.

In April 2023, The Gem & Jewellery Export Promotion Council (GJEPC) commences the first-ever Lab-grown Diamond Buyer Seller Meet (BSM) in Surat. The event was inaugurated by Mr. Virendra Singh, ITS, Development Commissioner & Additional DGFT; Mr. Kirit Bhansali, Vice Chairman, GJEPC; Mr. Vijay Mangukiya, Regional Chairman, Gujarat; Mr. Smit Patel, Convener, Lab-grown diamonds committee, GJEPC; Mr. Sabyasachi Ray, ED, GJEPC along with others.

Government Initiatives

Under Union Budget 2025-26, the customs tariff on jewellery (HSN code 7113) was reduced from 25% to 20% and on platinum findings from 25% to 5%, making jewellery more affordable and boosting domestic demand.

In the Union Budget 2024, the government proposed reduction in the basic customs duty on gold and silver to 6% and on platinum to 6.4%.

The sector now has AEO status from the finance ministry, easing export-import processes with quicker cargo release, 50% lower bank guarantees.

The Indian government accepted the recommendation of GJEPC to promote indigenous manufacturing in the emerging Lab-grown diamond sector by providing research grants to the Indian Institute of Technology (IIT) for five years.

India has signed an FTA with the UAE which will further boost exports and is expected to reach the target of US$ 52 billion.

The Government has reduced custom duty on cut and polished diamond and colored gemstones from 7.5% to 5% and NIL.

Revised SEZ Act is also expected to boost Gems & Jewellery exports.

MARKET DATA

Indias overall gems and jewellery exports declined by 11.72 per cent to USD 28.5 billion (around Rs 2.41 lakh crore) in 2024-25 compared to the previous financial year on continued geopolitical tensions, according to the Gem & Jewellery Export Promotion Council (GJEPC). The overall gems and jewellery exports stood at USD 32.2 billion (Rs 2.67 lakh crore) in 2023-24, according to GJEPC data.

However, in March, the exports improved slightly, witnessing a growth of 1.02 per cent at USD 2,582.97 million (Rs 22,340.89 crore), compared to USD 2,556.97 million (Rs 21,228.71 crore) in the same month of the previous year, it added.

"The decline in gems and jewellery exports is mainly due to the continuous dip in demand in China as well as the US, Indias key export markets, due to the ongoing geopolitical tensions. Also, the correction in rough diamond prices by 10-15 per cent impacted the value, causing the overall decline in exports," GJEPC Chairman Kirit Bhansali told PTI.

The overall exports of Cut and Polished diamonds (CPD) dipped by 16.75 per cent at USD 13,292.0 million (Rs 1.12 lakh crore) compared to USD 15,967.02 million (Rs 1.32 lakh crore) for the same period of the previous year.

Total gold jewellery exports during FY25 showed a decline of 0.11 per cent at USD 11,215.46 million (Rs 94,937.78 crore) against USD 11,227.72 million (Rs 93,066.82 crore) in FY24.

Silver jewellery exports in FY25 dipped by 40.58 per cent at USD 961.79 million (Rs 8,115.32 crore), compared with USD 1,618.63 million (Rs 13,424.4 crore) in the previous year.

However, exports of platinum jewellery in FY25 witnessed a growth of 11.79 per cent at USD 182.75 million (Rs 1,547.3 crore) against USD 163.48 million (Rs 1,354.41 crore) for the previous year.

Meanwhile, the coloured gemstone exports showed a decline of 8.01 per cent during FY25 at USD 440.38 million (Rs 3,729.93 crore), compared to USD 478.71 million (Rs 3,961.98 crore) in the previous year.

OPPORTUNITIES AND THREATS

OPPORTUNITIES

The most profound driver behind the Indian Gems and Jewelry Market is its deep-rooted cultural significance and tradition. Jewelry has been an integral part of Indian culture for centuries. It holds a special place in religious ceremonies, festivals, weddings, and other auspicious occasions. Traditional Indian jewelry, such as Kundan, Polki, Jadau, and temple jewelry, is celebrated for its craftsmanship and symbolic meaning.

The second significant driver is the rising disposable income and aspirational buying patterns among the Indian population. With the countrys economy steadily growing, a burgeoning middle class, and increasing urbanization, more people have access to higher incomes and aspire to invest in jewelry.

Indias Gems and Jewelry Market is not limited to domestic consumption; it plays a crucial role in global trade. The country is one of the worlds largest exporters of gems and jewelry, contributing significantly to foreign exchange earnings. Indian jewelry is highly regarded for its craftsmanship, intricate designs, and competitive pricing.

The export segment serves as a powerful driver of the domestic market. The international reputation of Indian jewelry increases its appeal among domestic consumers. This leads to a rise in the adoption of Western-style jewelry, with Indian brands incorporating global design trends and catering to a diverse clientele, both at home and abroad

THREATS

The Indian gems and jewellery market faces some challenges, such as high import duties, fluctuating gold prices, lack of standardization, and competition from synthetic and imitation products. The high import duties on gold and other precious metals increase the cost of production and reduce the competitiveness of the industry. The fluctuating gold prices affect the demand and profitability of the industry, as consumers tend to postpone or cancel their purchases when the prices are high. The lack of standardization and certification of the products leads to quality issues and consumer distrust. The competition from synthetic and imitation products, such as lab-grown diamonds and artificial jewellery, poses a threat to the industry, as they offer lower prices and similar appearance to the natural products.

SEGMENT WISE PERFORMANCE

The Company is one of the leading jewellery companies in the organised jewellery retail sector in India. It is engaged in the business of trade, manufacture and sale of gold, diamond, precious stone, gold and diamond studded jewellery as well as silver articles. It offers wide range and variety of gold, diamond and silver jewellery with a focus on certified diamond jewellery to cater not only to wedding jewellery but party and daily wear also.

Based on the geographical areas, the Company was having two operating segments i.e. domestic sales and export sales during the year. The revenue of Rs. 46,173.25/- Lakhs during the year was from the domestic market and revenue of Rs. 37.90/- Lakhs during the year was from the export sales.

OUTLOOK

India continues to remain worlds largest gold and silver consumer. India is also one of the worlds major silver importers and the worlds largest diamond cutting and polishing center.

Gold is a significant component of the countrys culture, serving as a symbol of wealth and prestige, a store of value and an essential factor of numerous celebrations. Gemstones are also making a big contribution to the shifting fashion trends, particularly among the elite and upper middle classes. Similarly, diamond jewellery is gaining popularity amongst all classes, especially the younger generation which finds it more suitable for daily wear, office wear as well as party wear. Silver jewellery is also looking at a resurgence amongst a certain class of consumers on account of its ethnic designs.

The jewelry market is expected to grow steadily and positively from 2024 to 2030 due to rising consumer demand, technological advancements, and changing consumer preferences. The global jewelry market is projected to reach $310.90 billion in 2024 and grow at a compound annual growth rate (CAGR) of 3.53% from 2024 to 2028. India is the worlds top revenue generator in the jewelry market, and its market is expected to reach $81.26 billion in 2024 and grow at a CAGR of 4.59% from 2024 to 2028.

Here are some factors that may contribute to the growth of the Indian jewelry industry:

Government initiatives: Such as mandatory hallmarking of gold, gold monetization scheme, and reduced import duty on gold and silver.

Growing middle class population.

Increasing women workforce.

Branded jewelry.

Surge in demand for traditional gold and gemstone designs.

Gold is a significant component of the countrys culture, serving as a symbol of wealth and prestige, a store of value and an essential factor of numerous celebrations. Gemstones are also making a big contribution to the shifting fashion trends, particularly among the elite and upper middle classes. Similarly, diamond jewellery is gaining popularity amongst all classes, especially the younger generation which finds it more suitable for daily wear, office wear as well as party wear. Silver jewellery is also looking at a resurgence amongst a certain class of consumers on account of its ethnic designs.

INTERNAL CONTROL SYSTEMS AND THEIR ADEQUACY

Company has put in place adequate internal control systems commensurate with its size of operations. Companys internal control systems include policies and procedures, IT systems, delegation of authority, segregation of duties, internal audit and review framework, etc. Company has laid down internal financial controls and systems with regard to adherence to Companys policies, safeguarding of its assets, prevention and detection of frauds and errors, accuracy and completeness of the accounting records and timely preparation of reliable financial information.

RISKS AND CONCERNS

Following can be some of the risks and concerns the Company needs to be wary of:

The largely unorganized structure of the market can affect the systematic functioning of the Company.

Political instability, which has a tremendous impact on the capital markets.

Likely opening up of the economy, which can be a double-edge sword.

The Diamond market in India is heavily influenced by the US Markets.

The major income component of the Company being exports, changes in economies or government policies of the countries to which the Company is exporting may also affect the operations of the Company.

Increasing competition among the Indian Exporters in this industry.

Quality Control: Maintaining consistent quality standards is essential in the jewelry industry. Ensuring the authenticity of materials and the quality of craftsmanship is crucial for maintaining consumer trust.

Compliance risk: Those risks associated with the need to comply with Government Laws and regulations. They also apply to the need to act in a manner which stakeholders and customers expect. The Company being into Trade and manufacturing is clouded with much compliance for its operations and has been meticulous in its compliance regime.

Financial risk: Company is in the Gems and Jewellery business and fluctuation in price of commodity in international markets as well as fluctuation of dollar price may impact the entire industry and these are associated with financial structure of the company, its transactions and the financial system in place. Being in jewellery line, the risks of theft and loss is always looming large.

Bullion Risk: The volatility in the gold prices exposes the Company to bullion risk as gold forms approximately 30% to 50% of the cost of the finished product.

OPERATIONAL PERFORMANCE & FINANCIAL PERFORMANCE

The financial statements of the Company have been prepared in accordance with the Indian

Accounting Standards (‘IND AS) specified under Section 133 of the Companies Act, 2013 and the applicable Rules, as amended from time to time and other applicable provisions.

Motisons Jewellers Limited one of the most renowned brands not only in Jaipur but throughout India. Under the Motisons brand, we operate four showrooms across Jaipur. Our jewellery business encompasses a wide range of products, including pieces made of gold, diamond, and kundan. We also offer jewellery crafted from earth, silver, platinum, precious and semi-precious stones and other metals. Additionally, our product line features gold and silver coins, utensils, and various artifacts. Our extensive product portfolio boasts over 300,000 batches of jewellery, including gold, diamond, and other pieces at various price points. With a focus on design and innovation, we excel in recognizing consumer preferences and market trends. Our strengths lie in the intricacy and quality of our designs.

During the year under review, the revenue from operations of the Company on standalone basis increased by 10.88% from Rs. 41,676.33 lakhs to Rs. 46,211.15 lakhs as compared to previous year, despite various adversities.

The summary of standalone financial performance of the Company as compared to previous year is as under:

The financial performance of the Company for the Financial Year 2024-25 and 2023-24 are summarised below:

	(Amount in lacs)
Particulars	31st March, 2025	31st March, 2024
Revenue from Operation/Turnover	46,211.15	41676.33
Other Income	73.91	41.32
Less:- Expenses during the year excluding depreciation	40,145.26	37057.52
Profit before tax and depreciation	6,139.80	4660.13
Less : Depreciation	199.52	176.29
Profit/(Loss) before tax after depreciation	5,940.28	4483.84
Less: Extra Ordinary Item	-	(28.88)
Less: Prior Period Items	65.92	89.30
Add/Less: Provision of Income tax including deferred tax	(1,557.25)	1142.56
Profit/(Loss) after tax and depreciation	4,317.11	3223.11

KEY FINANCIAL RATIOS

Key financial ratios of the Company, changes therein as compared to previous financial year alongwith explanations for those ratios where change is 25% or more are as under:

Key Ratios	Units	2024-25	2023-24	% Change	Explanation
Debtors Turnover	Times	309.92	329.63	-5.98%	Trade Receivables turnover ratio has been decreased due to increase in average trade receivables.
Inventory Turnover	Times	0.84	0.92	-8.94%	Inventory Turnover ratio decrease due to increase in average inventory.
Interest Coverage Ratio	Times	107.31	6.45	1564.99%	Debt Service Coverage Ratio increase due to increase in earning available for debt service in FY 2024-25 as compare to previous year.
Current Ratio	Times	5.77	3.37	71.17%	Current Ratio increase from 3.37 to 5.77 due to increase in current assets in F.Y. 2024-25 as compare to previous year.
Debt Equity Ratio	Times	0.17	0.33	-48.14%	Debt - Equity Ratio decrease from 0.33 to 0.17 due to decrease in the debt in F.Y. 2024-25 as compare to previous year.
Operating Profit Margin	%	14.37%	14.78%	-2.72%	Operating profit margin ratio decrease due to increase in operating expenses.
Net Profit Margin	%	9.34%	7.73%	20.80%	Net profit ratio increase due to increase in net profit in current year as compare to previous year.
Return on Net Worth	%	15.93%	18.39%	-13.36%	In the Current Financial Year Return on Net Worth decreased due to increased in capital employed.

INDUSTRIAL RELATIONS AND HUMAN RESOURCES:

The Company considers that its relationship with its employees is vital and ensures that employees feel valued and is endeavouring to create an environment and culture within which every employee can put his best efforts and maximize his contribution.

The Company ensures that all its employees remain competent through education, skills, training and experience as necessary. The Company has had cordial relations between the management and employees and an atmosphere of harmonious working to achieve the business objectives of the Company throughout the year. The Company is poised to motivate each of its employees to perform to the fullest extent possible and to appropriately reward their excellence. As on March 31, 2025 the total employee strength of the Company was 158. The industrial relations within the Company have remained harmonious throughout the year.

References - Various industry reports and websites including GJEPC, IBEF etc.