RBZ Jewellers IPO Review: The Indian Market is the largest consumer of Gold Jewellery in the world, slightly beating China with a market share of 28.8%. The Jewellery market is worth an astonishing 4.6 Lakh Cr, of which 85% is just Gold Jewellery.

To cash in on the country’s love for gold, a small-scale gold jewellery maker is coming up with their IPO. The Company, RBZ Jewellers is issuing shares worth Rs. 100 Cr on 19th December, 2023.

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RBZ Jewellers IPO Review

Let us learn more about the Company, and understand what part of the gold market it caters to. Then we will analyze its strengths and weaknesses and also compare it with its listed peers, before concluding.

RBZ Jewellers IPO Review – About the Company

RBZ Jewellers is one of India’s leading Gold Jewellery manufacturers, specializing in Antique Bridal Gold Jewellery, which consists of Jadau, Meena & Kundan work. As per the Care Edge Report, RBZ owns 1% of India’s Organized Wholesale Jewellery Market. 

The beginnings of the business date back decades in time when Shri Bababhai Hargovandas Zaveri, a Goldsmith from Patan, Gujarat laid the foundation for the family gold business. The Company changed its name to RBZ Jewellers in 2008, with Kantilal, Kiranben, and Harit Zaveris as its founding members.

The business owns a manufacturing facility in Gujarat covering an area of 23,966 Sq.ft, along with a retail space in the Satellite Area of Ahmedabad. It has a retail space of 11,667 Sq.ft, of which the Company owns 10,417 SqFt. 

The Company has quite a diversified business ranging from Wholesale, Retail, Bullion sale of jewellery, and a lot more. So, let us learn more about the Company’s Business Segments.

RBZ Jewellers – Business Segments

The Company ventured into the retail segment in 2014, with the launch of the brand Harit Zaveri. The segments offer a collection of Bangles, rings, bracelets, necklaces, and jewellery sets in Gold, Diamond, and Polki. The retail segment now commands a 37% share of the entire business and the segment grew by 59% in a year and 107% CAGR in 3 Years. 

Before that, RBZ was in the predominant wholesale business of crafting jewllery and selling it in bulk. The segment continues to be RBZ’s largest segment contributing to 48% of their FY23 revenue. However, the segment saw a 12% fall since FY22, although it maintained a 43% CAGR in the past 3 years.  

The other segments are the Sale of Bullion, the Sale of other jewellery, and Jobwork Services, where other brands outsource the Company to manufacture jewellery under their brand. These segments contribute to 7%, 5%, and 3% respectively.

RBZ Jewellers IPO – About The Industry

As per the Care Edge Report, the domestic jewellery market in India has grown to Rs. 4.64 Lakh Cr in CY22 compared to Rs. 2.3 Lakh in CY16. The increased standards of living led by a growing working population and higher disposable income have led to this strong growth.

As of CY20, the share of the organized retail jewellery market is only about 32%, with a lot of small-scale jewelers operating in the unorganized market. However, the market share of organized players is expected to grow to 40% by CY25. 

It is estimated that about 1-1.3 Cr weddings, of various sizes and scales, are held in India every year. Wedding jewellery is the largest spend, accounting for 24% of wedding expenses. 

In the gold jewellery sector, retailers generally purchase jewellery from wholesalers who either manufacture in-house or outsource the manufacturing to job-workers. This trend has increased considerably over the years with the growth of large retail chains that see value in sourcing from wholesalers due to a variety of designs and product innovations. 

The domestic gold wholesale jewellery industry is expected to grow from 378 tonnes (out of 600 tonnes of total gold jewellery demand) in 2022 to 402 tonnes by 2025 and 475 tonnes by 2030, at a CAGR of 2.5%.

RBZ Jewellers IPO Review – Financials

RBZ Jewellers reported a revenue of revenue of Rs. 290 Cr in FY23, which increased by 14.69% from Rs. 252 Cr in FY22. The Business has scaled revenue at a spectacular rate of 64% CAGR in the past 3 years.

Net Profits of the Business increased at an even better rate of 55%, from Rs. 14 Cr in FY22 to Rs. 22 Cr in FY23. The Company maintained a CAGR growth of 51% since FY21.

The Company has been maintaining EBITDA margins in the range of 11%-20% in the past three years. During the same period, Net Profit Margins were around 6%-10%. 

The Company maintained a healthy Return on Equity and return on Capital Employed of 27.49% and 20.08%. Maintaining ROCE in the 20%+ range despite having a debt-to-equity ratio of 1.04x is commendable.

Although the Company reports soaring profits, unfortunately, these profits have not been converted to actual cash flows. The Company’s Operating cash flows fell to Rs. -12.22 Cr in FY23. This was due to a significant increase in inventory of Rs. 30.18 Cr.

When we look at its Balance Sheet, we realize that in FY23 the Company’s Inventory was worth Rs. 149 Cr, which is about 72% of the Company’s total Assets. This uncleared inventory is what leads to a liquidity crisis in the Company, eventually leading to a drop in returns.

Now let us look at the listed jewellers in the Country & understand how RBZ holds up against its peers. 

RBZ Jewellers – Key Players 

At the higher end of the price band, the Company would be valued at 13.44x. Compared to peers, this would make RBZ the most affordable stock in terms of earnings.

In terms of Return on Net worth, RBZ falls just behind Titan Company and DP Abhushan, both of which have PE of 93x and 28x. However, in terms of revenue, the Company remains the smallest in size, just above Ashapuri Gold.

RBZ Jewellers Key Competitor
Source: RHP of the Company

Strengths of the Company

  1. The Company has a list of Marquee clients which includes Titan, Malabar, Joyalukkas, and multiple others.  
  2. With a single integrated manufacturing facility in Gujarat, the Company can house the entire chain of designing to manufacturing, all under one roof. This form of efficient setup is preferred by its largest clients.
  3. RBZ has a well-diversified business, both in terms of segments as well as clients. The Company’s top 10 customers account for only 20.68% of FY23’s revenue.
  4. Due to the wholesale-dominated nature of the business, RBZ would be able to clear out its inventory sooner than retail businesses.
  5. The Promoter family comes from the line of jewllery makers. The Promoter Kantilal Zaveri has over 35 Years of experience in the industry. With this experience, the Company can blend Antique designs with the latest technology to improve manufacturing.

Weaknesses of the Company

  1. Due to the capital-intensive nature of the Jewellery business, the Company faces the issue of Working Capital. This resulted in a Debt-to-equity ratio of 1.04x in FY23 and 0.98x in H1FY24.
  2. Being a manufacturer of Jewellery, the Company faces the risk of volatile Gold Prices. Additionally, The Company does not have any exclusive supply chain agreements or forward contracts to hedge against price risks.
  3. The Company’s inventory issues as discussed in the Financials segment remain a major concern. Failure to clear this inventory can have adverse effects on the Company’s balance sheets

RBZ Jewellers IPO Review – GMP

Currently we dont have the information on the GMP, We shall update the article once we receive the information.

Key IPO Information

IPO SizeRs. 100 Cr.
Fresh IssueRs. 100 Cr.
Offer for Sale (OFS) 0
Opening date19 December 2023
Closing date21 December 2023
Face Value10
Price BandRs. 95 - 100
Lot Size150 Shares
Minimum Lot Size1 Lot (150 Shares)
Maximum Lot Size13 Lot (1950 Shares)
Min. InvestmentRs. 15000
Listing Date27 December 2023

Promoters: Rajendrakumar Kantilal Zaveri & Harit Rajendrakumar Zaveri

Book Running Lead Manager: Arihant Capital Markets Ltd 

Registrar to the Offer: BigShare Service Pvt Ltd

The Objective of the Issue

  1. 80% of the Issue’s Funds would be used to service the Working Capital Requirement of the Company.
  2. The remaining amount would be utilized for General Corporate Purposes.


Now, we finally conclude the article having done our best to cover everything possible about the IPO issue. We see RBZ as a strong contender in the wholesale and even making quite a remark in the retail space. The earnings growth has been in the strong double digits.

However, the Company’s liquidity issues happen to be its biggest challenge. Apart from these looming challenges, the Company does have a lot of room for growth. 

So what do you think about RBZ? Do you think the IPO is worth applying for? Do let us know in the comments below.

Written by Nasir Hussain

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