Warburg buys upto 15% in Kalyan Jewellers for Rs 1,200 cr

The Kerala-based jewellery chain Kalyan Jewellers today said private equity major Warburg Pincus has invested Rs 1,200 crore, which would get the PE firm around 15 per cent in the privately-held jewellery maker.
The company has a target of Rs 10,000 crore turnover this fiscal, Kalyan Jewellers executive director Ramesh Kalyanaraman told PTI, but declined to comment on the quantum of stake that the PE will pick up in his firm.
Market sources, however, said Warburg's Rs 1,200 crore investment would fetch it around 15 per cent stake in the Thrissur-based company run by the billionaire TS Kalyanaraman.
The Competition Commission had last week approved Warburg Pincus-invested Highdell's proposal to pick up to 24 per cent stake in Kalyan Jewellers. The share-holders of the Mauritius- based Highdell Investment are the private equity funds managed by Warburg Pincus.

Proceeds from the investment, which the company claimed is the largest one in by a PE fund in a jewellery manufacturer and distributor, will be used for expansion of the network.
The 20-year-old company currently has 55 outlets in the southern states, Maharashtra, Gujarat, Delhi-NCR and Punjab, besides six outlets in the United Arab Emirates.

It is targeting to augment the network to 100 outlets by 2016 and add 28 outlets in the next six months, it said, adding, plans are also afoot to enter Kuwait, Qatar, Singapore and Malaysia.
The company said it is targeting to touch Rs 25,000 crore in revenues over the next few years. It, however, did not give a time frame to touch the mark.

Warburg Pincus India managing director and co-head for the country Vishal Mahadevia said the Kalyan group promoters have built up an organisation of scale over the past 20 years and a market leading brand.
It also has many firsts like a loyalty programme which has 2 million members now, introducing detailed price tags in interest of transparency and introduce BIS certification on gold jewellery, he said.
Warburg's past investments in the country include Ambuja Cements, Bharti Airtel, Dainik Bhaskar, Diligent Power, Capital First, Gangavaram Port, HDFC and Kotak Mahindra Bank, among others.