| I’m not prone to jewelry shopping on a weekday, but there I was last week at the elegant (and very beige) Zoya store in South Mumbai, learning about the patented “bloom” cut and “baoli” setting in its latest collections. Jewels dazzle me less than growth stories and Zoya is finally coming of age. The 16-year-old luxury jewelry brand from the Tata Group’s Titan Company has grown revenue five times in the last six years and is estimated to cross 5 billion rupees this fiscal. Zoya is barely 1% of Titan’s overall jewelry business revenue but it’s the “jewel in the crown,” said Ajoy Chawla, CEO of the jewelry business, sitting amid sparkling diamonds, golden citrines and lilac amethysts. The world has just woken up to the luxury opportunity in the country, he said, as we discussed how India added 39,000 millionaires last year, according to a UBS Wealth report. According to Chawla, there is scope for the $7 billion luxury wearable accessories market (jewelry, watches) to quadruple or even quintuple in the next five years. But for Zoya, he’s set a more conservative target of doubling sales in three years. I asked him why.  Zoya’s flagship Mumbai store. Source: Titan This interview has been condensed and lightly edited for clarity. India is minting over 100 millionaires a day. Why aren’t you growing faster? I think luxury cannot be hurried. I have Tanishq (the company’s national jewelry retailer) for that — it will grow from under 500 billion rupees currently to 1 trillion rupees over a period of time. Most luxury brands are decades and sometimes centuries old. The Taj Group of hotels is over 100 years old. Zoya is only 15 years young. A luxury brand needs a mindset which says I am here to create something which is perennial, beautiful and eternal. It is not something which can be forced into growth. Therefore it’s okay if it doesn't double quickly. I will not worry about it at all as long as it is the pinnacle of excellence and it’s building what I would call potential energy. Kinetic energy is easy to do. If you go down that path you may have sacrificed the potential energy. I think luxury is about just infusing potential energy and automatically the kinetic energy will follow. How have the customer and her shopping preferences changed? There is a certain segment of customers who continue to be there. Let’s say, they are wives of industrialists and significant better halves of the old rich. But today you see a lot more of the self-made young. The new rich, educated and well-travelled customer is substantial and willing to indulge. Because buying power has gone up, exposure has gone up. Also, many more Indian women today are totally independent and not just from an income point of view but also thinking, decision making, travel, exposed to the best in the world and genuinely taking their own independent decisions on many other fronts, leave aside jewelry. We are perhaps India’s first and foremost luxury brand that is truly Indian at heart but international in appeal. We sell products from 200,000 rupees all the way to 10 million rupees and we also do bespoke. It is truly luxury because the customer is no longer worried about how much gold is there, how many stones are there, what’s the making charge. Whereas if you go to other quintessential jewelers people will be buying a 5 million rupee product with big stones, but they're still buying it for the value of the stone, the gold. It is still an investment mindset.  Ajoy Chawla Source: Titan Due to rising gold prices, Tanishq customers are seeking more lightweight jewelry, lower caratage and lower making costs. What about at Zoya? What affects Zoya more is the share of wallet. So, for the customer we serve, suddenly if they want to travel a lot more then jewelry purchases can get impacted. Or if they want to spend on cars or they’re indulging in something else. What we find is that the share-of-wallet shifts create a certain lumpiness in demand. Gold prices, sometimes yes, but that generally is linked also to economic sentiment or if stock markets have gone up or down. Those kind of things do play a role. I don’t think any category in the world is immune from that. Broadly speaking, for jewelry the last six to seven quarters have been a volatile period, certainly linked to volatility in gold prices and demand sentiment. Every fortnight things change and we’ve got used to this now. We will still see 15% to 20% annual growth across jewelry but when you see month-to-month, quarter-to-quarter, it can be topsy-turvy. What new opportunity in luxury excites you the most? There are many jewelry segments where we think the opportunity has only begun. Like with luxury, the premium and the higher price point opportunity is a very, very lucrative opportunity. Especially since formalization of the market is happening. Most of these large, high-ticket value opportunities have historically been sitting with independents (jewelers). I think the consumer is shifting fast because of trust and the longevity of brands and players. Therefore, that is certainly the very large opportunity. And while adornment continues to be the big driver as opposed to investment, the resurgence of gold has been not lost on anybody, from the young to the old. So even if they may want a diamond-studded product or they want precious stones, they now see dollars when gold is there. I think the attraction of gold has intensified. You take over as CEO of Titan in January. Is it unnerving to be doing so in such a volatile market?
I think we all need a challenge in life. I've been with the company for 34 years. I will take a lot of immersion time over the next few months in understanding the rest of the organization which I have not been engaged with so much — the internal stakeholders, board members. And the other is a deep dive into the businesses so that I understand the strategy which is evolving. Are you investing in gold at these prices? Jewelry, coins or ETFs? Write to me at indiaedition@bloomberg.net. Thanks for reading. — Menaka. India Edition Last Week: Amazon Intensifies Battle for Health Care in India | 
