Malabar Gold in tie-up with diamond trader

Malabar Gold, a Rs 2,000 crore Kerala-based jewellery retail chain, has entered into a joint venture with Gujarat-based Mahendra Brothers, a DTC (De Beers) manufacturing sightholder since 1969.

A sightholder is a company on the Diamond Trading Company’s (DTC) list of authorised bulk purchasers of rough diamonds. DTC is controlled by the De Beers Group, the largest producer and purveyor of rough diamonds in the world.

The equal joint venture, MINE Diamonds Unlimited, will be a diamond jewellery brand and will be available through store-in-store retailing to start with. With gold being seen as a safe haven with every other asset seeing attirtion in values, the sale of gold seems to be on the rise. Malabar Gold claims that it has seen a 20 per cent growth in gold sales.

 

The JV will see seven stores being operational in two-three weeks for an investment of around Rs 30 crore. With this project Mahendra Brothers marks its entry into retail sales. This is perhaps a strategic move by Mahendra Bros to look inwards when the export markets are slowing down.

Mahendra Brothers is one of the largest makers of cut and polished diamonds in the country and has set up four diamond polishing units and three other units that make diamond-studded jewellery.

Despite the huge spike in the price of gold in the global market, with gold being $750 an ounce, for Abdul Aslam

K P, director, Malabar Investments Limited, the holding firm of Malabar Gold, feels that $1,000 per ounce will be a safer price.

Malabar Gold, which has a wholesale trade in addition to retail business in Dubai, also plans to open four stores in UAE, and one each in Qatar, Saudi Arabia, Kuwait, Oman and Bahrain.