Rajesh Exports: Glitter & Gold

India’s is deemed to be the hub of global jewellery market, thanks to the availability of high-skilled labour and low cost of . India is the world’s largest cutting and polishing centre for diamonds, with the cutting and polishing industry being well supported by government policies. Moreover, India exports 75 per cent of the world’s polished diamonds, as per statistics from the Gems and Jewellery Export promotion Council (GJEPC). India’s Gems and Jewellery sector has been contributing in a big way to the country’s foreign exchange earnings (FEEs). The Government of India has viewed the sector as a thrust area for export promotion. The Indian government presently allows 100 per cent Foreign Direct Investment (FDI) in the sector through the automatic route. Rewriting history in the sector is the 53-year-old Rajesh Mehta, Chairman Rajesh Exports (REL).

Mehta is a first generation entrepreneur and has an inspiring success story that has been heard and much revered. Mehta started the company with a meagre amount of Rs 1,200 close to three decades ago and now has taken the company’s consolidated revenue up to Rs 1 lakh crore.

Rajesh Exports, the world’s largest gold refiner, has procured an order worth Rs 933 crore from the UAE. The order will be executed by March 2019, the company said in a regulatory filing. “We have bagged a large order this month amid strong global competition which speaks volumes about the quality of our products, prompt execution and attractive pricing,” the company’s chairman Rajesh Mehta had said in the report. Rajesh Exports has launched new products at different prices, has been witnessing consistent order flow from across the globe, he added.

The Bengaluru-headquartered company has its refineries located in Uttarakhand and at Balerna in Switzerland. It has a capacity to refine 2,400 tonne of gold per annum. The company processes 35 per cent of gold produced in World. It has been consistent in winning orders from the international market, despite volatile global market conditions.
REL reported 34.43 per cent jump in consolidated net profit to Rs 399.1 crore for the quarter ended June 30, 2018. Net profit in the year-ago period stood at Rs 296.8 crore, the company said in a regulatory filing.

Total income declined to Rs 43,926.7 crore from Rs 50,408.2 crore in the year-ago period. Expenses however remained lower at Rs 43,535.7 crore as against Rs 50,116 crore in the said period. The company said its order book stood at Rs 44,628.7 crore till June-end.

“The company has achieved a significant milestone in recording the highest ever ebitda and profit after tax (PAT) for a quarter. The company is on track of its objective of achieving higher profits,” Mehta said. The company’s focus on achieving higher value addition and on expanding its retail footprint has paid rich dividends to the profitability of Rajesh Exports, he said. It is also in the process of building a world class gold refinery at Bengaluru, to add to the backward integration strengths, which would ensure smooth flow of raw material for its forward operations, he added. With the recent acquisition of Valcambi, the world’s largest gold refinery in Switzerland, REL has built up a total capacity to refine 2,400 tonne of gold per annum. REL is largest refiner of gold in the world. It processes 35 per cent of gold produced in the world. It has a presence across the value chain of gold from mining till its own retail brand.

Re-identification of risks has been at the core of REL’s success story. “The company has a robust ERM framework to identify, evaluate business risks and opportunities. This framework seeks to create transparency, minimise adverse impact on the business objectives and enhance the company’s competitive advantage. The business risk framework defines the risk management approach across the enterprise at various levels including documentation and reporting... The company has identified various risks and also has mitigation plans for each risk identified.” Mehta shared in the company’s annual report.