Uber luxury stokes Seiko

Seiko is betting on super-luxury watches in India and re-positioning itself. The Japanese watchmaker will trim its low-end portfolio to concentrate more on the ultra-luxury space.

In watches, ultra-luxury might just start selling more. Technopak explains in a report: 'The structure of the market is that of a pyramid with the mass segment having the largest contribution. However, in the coming years, the market is expected to become like an inverted pyramid as the luxury and prestige watch segments are growing faster, mirroring the trend in most international markets. Factors like growing economy, increasing consumerism, favourable demographics, a 300-million-strong middle-class and more than a million high networth individuals hold promise for the timewear industry in the near future'.

Seiko will launch its iconic 'Grand Seiko' line of watches in November. The collection starts at about $7,000 and extends up to a whopping $100,000. The Grand Seiko range counts the watches of Patek Philippe, Breguet, Rolex and Hublot among its competitors.

Atsushi Kaneko, president, Seiko Watch India, says the growth rate for super-luxury watches in India is very promising, even though it lags the growth in the premium and luxury segments.

The luxury watch segment - watches priced above Rs 1 lakh - is estimated at about Rs 900 crore, selling 210,000 pieces. It is estimated to be growing at a rate of 15-20 per cent, according to Technopak Advisors.

Seiko's watches compete with Rado and Tissot in the premium segment (priced above Rs 20,000) and Omega and Tag Heuer in the luxury segment.

However, analysts are not sure about the super-luxury category in India, which has trailed China, the world's third-largest luxury market, in other lifestyle product categories. The falling value of the rupee might prove to be another dampener.

"Besides, the audience that Seiko is now targeting has easy access to international markets where it has a wider range of products," analyst Abneesh Roy of Edelweiss Securities adds.

Seiko, however, plans to open three new watch boutiques in New Delhi, Mumbai and Hyderabad by December, in addition to five existing boutiques it has been operating since 2010. "We want to showcase the Grand Seiko. The elite segment we are catering to is the one we believe would be less affected by the external factors worrying the Indian economy, " Kaneko says.

Seiko will trim its collection in the lower-end, as it used to offer watches priced from Rs 8,750, going up to Rs 2.3 lakh. It launched the Ananta Spring Drive, priced close to Rs 4 lakh this year and wants to expand its portfolio in that range with the Grand Seiko. "Grand Seiko's finish from the hands, the dials to the case is spectacular. It is our best in terms of mechanism," Kaneko says. Seiko plans to stock just a few pieces of the watch - in stainless steel, gold and platinum - at its boutiques. Launched in 1960, the collection has won a series of awards for mechanical precision, from 1968 right up to 2012. "We have a line of new-generation Grand Seikos, slightly sporty. But the true essence of the Grand Seiko is its classic look," says Rajesh Patel, senior marketing manager.

Seiko, which is celebrating a century of making wristwatches, is enthused by the advent of luxury malls across the country as being the right platforms for its most expensive range.