Bangalore-headquartered Rajesh Exports Ltd, one of the largest public-listed gold jewellery manufacturing companies in the country, is getting into the gold finance business, the company said in a stock market disclosure.
The company will have a board’s meeting on February 9, 2015 for deciding the same.
It will form a new division for foraying into the gold finance business but will use its existing network of 81 retail showrooms to push the business.
Gold finance is a high margin business and the market is dominated by South-based firms Muthoot Finance and Manappuram Finance besides various banks which also lend against gold as a security. Muthoot and Manappuram are backed by PE investors.
Rajesh Exports would become the first large jewellery firm to get into the gold loan business.
The company manufactures both gold & diamond jewellery and exports its products globally. It is, however, associated more with its gold jewellery unit and has a large manufacturing plant in Bangalore. The firm also retails its products through its own network of jewellery showrooms Shubh Jewellers.
For the third quarter ended in September 30, 2014, the firm reported net profit of Rs 159.76 crore with net sales at Rs 10,959.4 crore.
Shares of Rajesh Exports were trading at Rs 174.75 each, up 8.47 per cent on BSE in a strong Mumbai market on Tuesday at 3.13 PM.
(Edited by Joby Puthuparampil Johnson)