(i) The company mainly engaged in the wholesale supply and trading of precious stones, primarily cut and polished diamonds. They also deal in gold jewelry. They sell products to their clients domestically. They are located in Mumbai, which is an established jewelry market which gives us an added advantage in terms of procurement.

(ii) They deal in a variety of diamonds which include both rough and polished diamonds. They buy and sell diamonds in local markets as per the demand. They also sell diamonds of multiple categories based on different shapes, size, cut and fancy color. They mainly deal in diamonds of 0.10 – 5.0 carats. Well-cut diamonds sell at a premium and poorly cut diamonds sell at comparatively cheaper prices.

(iii) They are also engaged in the gold jewelry business. They primarily sell gold jewelry i.e. Chains, Bangles, Necklace, Pendant, Bracelet, Earrings and other jewelry studded or non-studded with pearls, diamonds, and other precious stones. They offer Jewellery across different price ranges from low to high to cater to the customer base.

(iv) They are also engaged in investment in real estate properties in Mumbai for the purpose of selling them for trading gains. In the real estate business, they are focused on Maharashtra and Gujarat. They invest in both residential and commercial properties based on their own study of the market. They are also involved in real estate broking.

IZ View

The company is involved in trading of gold and Diamond jewelry and real estate business. There is no moat in the business. Anyone with knowledge of Jewelry can start this business. The sector is very competitive. In Mumbai and Gujarat, you can find jewelry shops in every nook and corner. The PAT margins for FY19 are around 4.20% which shows this is low margin business.

This as a sector has not given good returns to investors in the past barring Titan.