He was a smooth operator who moved with the swish set in Canalli suits and Bentley cars. A Wharton-based dropout who wooed India’s elite with his persuasive charm, it’s quite a fall for luxury jeweller Nirav Modi!
Modi seems to have been flying too high, too soon. He had India’s leading movie stars like Priyanka Chopra endorsing his brand ‘Inspire Awe’ while others happily wore his jewellery to red carpet events, catapulting him into the position of one of India’s most sought after jewellers.
In 2016, he held a lavish soiree at the Umaid Bhavan in Jaipur, and flew his clients in from across the world. He was a leader of the new age jewellers who splurged on advertorial spaces in high end fashion glossies and showcased their creations on the nubile arms and tender necks of perfectly painted models.
A quick glance at any of these magazines will reveal that virtually every second page is a jewellery ad — Khanna Jewellers, Hazoorilal, Kanjimul Jewellers, Dia, Farah Khan, Sunita Shekhawat, KaJ, Nirakara Jewels... the list is endless. Several new players have entered the market over the last decade, aggressively advertising their baubles by hiring A-list Bollywood stars like the Bachchans, Priyanka Chopra, Malaika Arora, Chitrangadha Singh and more. Plush stores in prime properties are opened in every part of the country.
Traditional jewellers gob-smacked
A prominent 5th generation jeweller from Jaipur who does not wish to be named, says, “We would always wonder how a new entrant in the business can afford these kinds of showrooms all over the country, pay crores to actors to model for them and avertise in all the glossies. The margins in jewellery are not very high. We have very wealthy customers but they are wary of buying what a Nirav Modi is selling or even a Sabyasachi Muherjee — this designer is now designing/selling jewellery! Their designs are no doubt very good but who is to identify the quality and justify the price? The price of diamonds and other gems are not as transparent as gold. So who are their customers?”
Agrees Hyderababd jeweller Akshay Sudhir Shah of Raja Bhagwandas Haridas & sons jewellers, “Sustainability is getting difficult because of this new age advertising and celebrity endorsements. But when you try and sell jewellery back, you actually come to know the true quality of what these designers are selling. The buy back is really less.”
Most people buy jewellery from their family jewellers, confident that they will not be taken for a ride. Hari Kishan Gupta of Totaram and Murarilal Jewellers has been in the jewellery business from 1901. “Our clients have been coming to us for generations. There is implicit trust... They are never unhappy with our quality of work and that’s how we have survived all these years. The new age jewellers have come up suddenly and started big posh stores by taking huge loans from the banks,” he says.
Further, Gupta adds, “Earlier, every year, gold prices would increase so jewellers made profits on their old stock but now gold is stagnant. So if stocks don’t sell, you lose a lot of money. The investment is high. It doesn’t make sense if you are a new player and need to build a brand because you must have the capacity to withstand huge losses initially. Which is why many jewellery brands are in heavy losses. And the interest in bank loans is multiplying. For us, our overheads are very less, so is our inventory. We don’t even think of opening stores all over the country as this is what results in heavy losses.”
The old family jewellers are proud to carry forward a legacy that has been built on client trust over generations. To them, jewellery is not just a money making racket, but a much loved family tradition. Like C Krishnaiah Chetty & Sons in Bengaluru, which continues to have a loyal clientele. Chaitanya V. Kotha, who is a director with the brand, says, “Running a business is not easy. For most buyers, buying jewellery has got an emotional connect too. The amount spent is immaterial. So, understandably, it is safer to settle for a reputed brand that has been around for decades, completed an entire cycle of ups and downs, and has survived. C. Krishniah Chetty & Sons has had first generation as well as sixth generation buyers.”
He adds, “As a brand, we do not buy jewels from foreign or unethical sources. Generally speaking, it is easy for businesses to sprout and make it big overnight with funding. But it takes integrity and real effort to sustin.”
