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PC Jeweller Curbs Exports in Credit Crunch

Dec 3, 2018 9:47 AM   By Leah Meirovich
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 PC Jeweller plans to reduce its exports by more than a quarter during the current fiscal year as it looks to minimize its credit needs in a tighter Indian lending market.

The company receives payment for exports several months after a transaction, and therefore has to take bank loans to buy raw materials and support the business, Sanjeev Bhatia, PC Jeweller’s chief financial officer, told Rapaport News Monday. Shifting focus toward domestic sales will boost its financial position, as those customers typically pay immediately, it said in a statement last month.

“The company wants to rationalize [its] export…business as the credit availability is getting squeezed,” Bhatia said in the statement.

The company, which manufactures, retails and exports jewelry, slashed outbound shipments by 89% in the second fiscal quarter ending September 30. It aims to cut exports by 26% to INR 20 billion ($286.7 million) for the full fiscal year ending March 31, 2019, from INR 26.9 billon ($385.6 million) last year. The segment currently represents about 5% of its sales.

Total revenue fell 37% to INR 16.63 billion ($238.4 million) in the three months ending September 30 amid a “subdued market,” while profit dropped 38% to INR 937.2 million ($13.4 million), it said. Domestic sales declined 16%.

Image: PC Jeweller store, India. (PC Jeweller/Facebook)
Tags: Leah Meirovich, PC Jeweller, Rapaport News, Sanjeev Bhatia
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