(MENAFN- Muscat Daily) Muscat- Malabar Gold & Diamonds, one of the world's largest gold and diamond jewellery retailer, has announced a major investment amounting to AED335mn (US$91.28mn) for expansion plans of its retail network.
The plan will see an addition of 24 stores in three months, from January to March, taking the number of total outlets to 185 by the end of March, up from 161 as of today.
Out of the 24 new outlets, nine will be in the UAE, seven in India, five in Saudi Arabia, two in Bahrain and one in Kuwait.
Of these, seven outlets opened on January 18, taking the number of total outlets to 168, including 82 in India and 86 internationally.
The expansion will add more than 1,000 professionals to the group's existing manpower strength of 9,000 and cross the 10,000 employee mark by March.
The move marks a major investment in expansion at a time when many gold and jewellery retailers have struggled to manage their existing operations due to the challenging global economic environment.
Despite the tough market conditions resulted by lower demand, higher price of gold and demonetisation process in India, Malabar Gold & Diamonds has decided to push ahead with expansion, which demonstrates its confidence in the growth of market in future.
M P Ahammed, chairman of Malabar Group, said, 'This is one of our single largest vertical expansion drives. The expansion at a crucial time reflects our renewed confidence and strong commitment to the Gulf, India and Far East markets. Investment in the downturn market requires courage and strong risk appetite. Our latest expansion demonstrates our long-term vision and a sustainable business development roadmap that we can manage mostly with our own resources.'
He added, 'The expansion is aimed at serving more communities and nationalities, especially people from the Philippines, African Arab communities, the Levant as well as the Western countries. The extended network will help us acquire a greater customer base.'
The price of gold has risen in almost every major world economy during 2016, suggesting that the dark days are over and good times are coming back. The gold price is almost ten per cent higher today than what it had been 12 months ago.
Abdul Salam K P, group executive director of Malabar Group, said, 'Retail activities are a reflection of the consumer sentiment. Due to market conditions, consumers exercised caution. However, things are looking brighter as we started the New Year with a lot of positive indications.'
As per company officials, the current price of gold jewellery is ideal for buyers.
Shamlal Ahamed M P, managing director – International Operations of Malabar Gold & Diamonds, said, 'Due to market conditions, consumers on an average purchased less gold.
'However, although the average ticket size was low, the transaction value remained almost flat, which means the number of customers have grown.
'Data from our own sales across the network show that we have acquired more customers last year – who purchased from us for the first time – that compensated for the lower average purchase transaction value.'
He added, 'I believe that the current market conditions are best suited for buyers as the price of gold is expected to rise. This year, we expect consumers to be less cautious and buy more – a trend that will lift consumption.'
Malabar Gold & Diamonds is the flagship company of Malabar Group, a leading diversified Indian business conglomerate. The group owned by over 1,700 investors was ranked among the top five jewellery retailers globally.
Established in 1993 in the Indian state of Kerala, Malabar Gold & Diamonds today has a strong retail network of over 161 outlets spread across nine countries.
Malabar Gold & Diamonds had earlier announced donating five per cent of its profits in CSR activities aimed at supporting the societies across five key areas: Education, women empowerment, healthcare and research, housing and environment.
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