Chennai-based Lalithaa Jewellery Mart, a dominant player in the organized jewellery retail space, has taken its first step towards entering India’s capital markets. Lalithaa Jewellery filed Draft Red Herring Prospectus (DRHP) with the Securities and Exchange Board of India (SEBI) for a INR 1,700 crore public offer.
Lalithaa Jewellery Mart’s IPO will consist of a fresh issue of INR 1,200 crore and an offer for sale (OFS) of INR 500 crore by promoter M. Kiran Kumar Jain. The company is currently led by Jain along with Hema Kiran Kumar Jain. If successful, it would rank among the largest IPOs in India’s jewellery retail sector in recent years, particularly by a regional player.
Lalithaa Jewellery Mart IPO Details
The offer consists of:
- Fresh Issue: Up to INR 1,200 crore
- Offer for Sale: Up to INR 500 crore by promoter M. Kiran Kumar Jain
The face value of each equity share is INR 5. Final price bands, lot sizes, and post-issue shareholding will be disclosed closer to the IPO launch.
Book Running Lead Managers (BRLMs):
- Anand Rathi Advisors
- Equirus Capital
Registrar to the Offer: MUFG Intime India (formerly Link Intime)
Use of IPO Money
Proceeds from the fresh issue will be used for setting up 12 new stores, with INR 1,014.5 crore. Some of the portion will also be used for A general corporate purposes, subject to a 25% cap on gross proceeds.
This expansion plan aligns with Lalithaa’s strategy of scaling its large-format and medium-format stores, primarily in Tier II and III cities across South India.
Business Overview
Lalithaa Jewellery was founded in 1985, the company has built a strong retail footprint, operating 56 stores across 46 cities as of 31 December 2024. The company operates predominantly in Tamil Nadu, Andhra Pradesh, Telangana, Karnataka, and Puducherry. It has emerged as the most productive jewellery retailer by revenue per store, outpacing national chains, according to a CRISIL report.
Regional Store Distribution:
- Andhra Pradesh: 22 stores
- Tamil Nadu: 20 stores
- Karnataka: 7 stores
- Telangana: 6 stores
- Puducherry: 1 store
Format Strategy:
- 47 stores are over 5,000 sq. ft.
- Emphasis on Large Format Stores (>15,000 sq. ft) and Medium Format Stores (5,000–15,000 sq. ft)
Lalithaa Jewellery Mart: Financial Performance
Lalithaa Jewellery has demonstrated consistent revenue and profit growth in recent fiscal years, driven by strong customer loyalty, regional branding, and value-based pricing.
Key Financial Highlights:
| Particulars | FY22 | FY23 | FY24 | 9M FY25 |
|---|---|---|---|---|
| Revenue from Operations | 8,139.42 | 13,316.80 | 16,788.05 | 12,594.68 |
| PAT | 166.77 | 238.39 | 359.83 | 262.33 |
| EBITDA | 395.41 | 502.28 | 680.17 | 545.33 |
| ROE (%) | 17.79 | 21.91 | 25.96 | 15.48* |
| ROCE (%) | 21.84 | 27.13 | 30.44 | 19.44* |
| Revenue per Store | 214.19 | 283.34 | 316.76 | 224.91* |
| PAT Margin (%) | 2.05 | 1.79 | 2.14 | 2.08* |
| Inventory Turnover Ratio | 3.19 | 3.83 | 3.91 | 2.36* |
*9M FY25 figures are not annualized.
Product Mix: Gold Remains the Crown Jewel
The company’s product portfolio is skewed heavily towards gold:
| Product Type | FY24 Revenue Share |
|---|---|
| Gold Jewellery | 93.96% |
| Silver Jewellery | 3.89% |
| Others (Incl. Diamond) | 2.16% |
This product concentration reflects consumer preferences in the southern Indian market, known for its traditional affinity for gold jewellery.
Customer Schemes
Lalithaa has capitalized on recurring customer engagement through two flagship jewellery schemes. This ensure visibility of revenue:
1. Dhana Vandhanam:
- Monthly instalments: INR 1,000 to 10,000
- After 11 months: 50% bonus on one month’s instalment + 50% discount on value addition charges
2. Free-yo-Flexi:
- Monthly instalments up to INR 25,000
- After 11 months: 100% discount on value addition charges
As of 31 December 2024, 4,20,261 active customers were enrolled in these schemes. This has led to substantial customer advances, which stood at INR 1,943.2 crore in FY24 — the highest among key jewellery players.
Manufacturing Edge: In-house Goldsmithing at Scale
To support its expansive retail ambitions and cost control strategy, Lalithaa operates two manufacturing facilities:
- Chennai (Thirumudivakkam): 43,681 sq. ft.
- Kanchipuram (Maraimalai): 20,000 sq. ft.
Combined, they employ 563 karigars and have support from an additional 278 contract-based artisans. This vertical integration allows for faster inventory turnover, design control, and margin optimization.
Market Dynamics and Competitive Landscape
South India accounts for nearly 40% of India’s gold consumption, making it a lucrative and competitive market. Lalithaa’s ability to combine affordability with trust and tradition has helped it emerge as a leader in the Tier II and III segment — a customer base traditionally dominated by unorganized retailers.
The company’s value proposition resonates in price-sensitive markets, especially in the post-COVID era, where there’s a growing consumer shift from unorganized players to credible, branded jewellers.
Risks and Watchpoints
While Lalithaa’s business fundamentals are solid, investors should consider:
- Geographical concentration in South India
- High reliance on gold, with limited diversification into diamonds or lifestyle categories
- Gold price volatility, regulatory changes (like hallmarking mandates), and evolving consumer trends
- A relatively thin PAT margin (~2%) despite strong top-line growth
Conclusion
Lalithaa Jewellery Mart’s ₹1,700 crore IPO marks the public debut of a high-growth southern retail giant with deep roots in Tier II and III India. With robust margins, strong customer advances, and industry-leading store productivity, the issue presents a compelling regional consumption story.
However, market appetite will hinge on pricing discipline and the company’s ability to scale beyond its southern stronghold. For investors betting on organized retail growth in Bharat, Lalithaa Jewellery Mart offers a glittering, yet regionally concentrated, opportunity.