Five Indian brands are in the top 100 global powers of luxury goods list. While Titan from Tata Group moved up three places to rank 22nd and being among the top 20 fastest-growing luxury goods companies, four other homegrown brands, Kalyan Jewellers, Joyalukkas, PC Jewellers, and Tribhovandas Bhimji Zaveri Ltd, have been ranked 37th, 46th, 57th, and 92nd, respectively, in the Deloitte Global 2021 edition of Global Powers of Luxury Goods.
The top 10 luxury brands featured in the list included leading firms from Europe, the Middle East and Africa region such as French major LVMH Moët Hennessy-Louis Vuitton SE; Kering SA, which runs brands like Saint Laurent, Gucci, Balenciaga, Bottega Veneta, Alexander McQueen; Capri Holdings that runs Versace, Michael Kors, and Jimmy Choo; Compagnie Financière Richemont that is the parent company of Cartier, Chloé and Dunhill; Chanel Limited, L’Oréal Luxe, Hermes International and Essilor Luxottica.
Deloitte said that these top 100 luxury goods companies generated $252 billion in revenue globally, despite the challenges of 2020 when most firms concentrated their efforts on sustaining their businesses. More than half of these top 100 firms were profitable in FY20, added the new report.
In India, the trend remained consistent similar to previous years with the gems and jewellery category dominating the latest edition featuring the five brands, Deloitte said in a statement.
Tribhovandas Bhimji Zaveri Ltd is a first-time entrant to the list of the top 100 luxury goods companies that generated USD 252 billion in revenues globally, it added. “Indian jewellery retailers have always been resilient. With increased vaccination and a decline in the number of COVID-19 cases, the festive season saw a strong demand compared with the past year. The Indian brands banked on their strengths and weaved in online solutions that complemented their growth strategy,” Deloitte Touche Tohmatsu India LLP Partner and Consumer Industry Leader Porus Doctor said.
It said that Titan Company had made sales of $2,888 million in FY2020 and saw a net profit margin increase of 7% versus the year before. Its net profit margin is based on total consolidated revenue and net income. In the last three years (FY2017-20) the company has demonstrated a sales CAGR of 17%.
Kalyan Jewellers, which was up 6 rankings from 2019 to 2020, for instance, saw a luxury goods sale of $1424 million and a revenue of $1435 million for FY2020 and a net profit margin of 1.4%. It showed a CAGR of 0.9% between FY17 and FY20.
Joyalukkas India, up three rankings, saw a luxury goods sale of $ 1,131 million (estimated) and a revenue of $1131 million (estimated) for FY2020 and a CAGR of 6.1% between FY17 and FY20.
But it added that while it was in the top 100 list, PC Jeweller’ fell in its ranking ten places with sales falling by 40%, as consumer demand plunged due to a sharp increase in gold prices, low growth in the Indian economy, and the impact of COVID-19 on the peak marriage month of March 2020.
As per the report, about 14 vertically integrated jewellery retailers from India and China featured in the top 100 list.
The leading US jewellery company, however, it said, Tiffany & Co., will disappear from the Top 100 in next year’s report, as its acquisition by LVMH was completed in January 2021.
This report also used sales-weighted composites and not simple arithmetical averages as the primary measure for understanding group financial results and its definition of luxury ranges from traditional ultra-luxury, through super premium and aspirational luxury, down to affordable/accessible luxury.
“Sophisticated e-commerce ecosystems and partnerships allowed these luxury companies to keep the control they require over their brands’ digital marketing and pricing as well as their purchasing relationships with clients, at an affordable cost,” it said adding in the past one year luxury e-commerce went past the tipping point to become a vital part of the omni-channel distribution strategy.
More than 80 per cent companies in the top 100 reported lower luxury goods sales in FY2020 (January-December 2020 period), reflecting the adverse impact of COVID-19, the report said.
However, despite a fall in luxury goods sales growth, more than half of the top 100 companies were profitable in FY2020, it added.
