Gitanjali Gems, L Capital in fresh investment talks

Listed jewelry firm Gitanjali Gems has revived talks with

L Capital, the private equity arm of the world’s largest luxury group LVMH, for a strategic investment. The two were in negotiations a year ago but talks had not progressed over the structure of the business. In the last one year, the company has been working on restructuring its businesses, which is close to completion.

L Capital, which has invested in two businesses in India -- Genesis Luxury and Fabindia -- in the last one year, is exploring investment opportunities in aspirational, affordable and alternative brands, which address the middle of the pyramid and are not mass market. It is looking at investing in the fashion and jewelery segment as well, alongside consumer brands, leather goods, watches, F&B, beauty and wellness, and media and entertainment. It invests in companies where it feels LVMH’s global network and experience can add strategic value to the company.

The investment in Gitanjali is expected to help its brands, which have done well in India, to go global and improve their image. Last year, London-based brand consultancy Brand Finance valued nine of the company’s top jewellery brands at Rs 5,584 crores.

In the restructuring exercise, the company is creating three focused verticals under the holding company Gitanjali Gems-the diamond and jewellery manufacturing business, which includes exports, domestic branded jewellery, which will house all its brands (such as Nakshatra, D`Damas, Sangini, Gili, Asmi) and its retail business and finally, the international distribution and retail business. Gitanjali Gems had appointed consulting firm KPMG to help restructure its business.