“There is a long runway in this. That long runway that we are going to see is what excites everybody who wants to play this category. So we have great governance, we are fast growing, we are profitable and profits are growing faster,” says Mithun Sacheti, MD & CEO, Caratlane.
What are you thoughts on your current performance?
Actually the enterprise value now also will be closer to Rs 18000 cr not Rs 17,000 cr. Most people do not have that figure right as well because that is the equity value of the business. A business which grows at 50% plus for five years in a row and has become as qualitatively profitable as we are right now, where governance standards are that of a listed entity like Titan. We have caught it by the tail and we are sort of riding that. There is a long runway in this. That long runway that we are going to see is what excites everybody who wants to play this category. So we have great governance, we are fast growing, we are profitable and profits are growing faster.
What is the number at last for the year?
We did Rs 2200 crores revenue last year and about Rs 150 crores of EBITDA, Rs 160 crores I think we did and that is possibly going to grow north of Rs 3000 crore very easily this year. And we are in a space which is growing very well. When you are on the right ride, then everybody wants a part of it.
But one cannot take away from the fact that yes, the space is growing but there were a lot of players as well. How did you manage to really stand out or beat the competitive intensity?
I think it has got to do with how you align yourself with partnerships. And the fact that Titan brings in trust and Titan brings in best practices on that and the team at Caratlane brings in the next practices to this business and the market is ripe for it.
Market is ripe for everybody. That combination sort of worked well I think. I have always believed in building everything through partnerships. In my head, the customer is a micro partnership, the vendor is a micro partnership, the team is a slightly bigger partnership and the relationship with Tata was the big partnership. So all these partnerships, if aligned well sort to deliver well.
At the start, like probably everyone who starts out there were a lot of naysayers. They said, this is never going to work. Who is going to buy online? What did you feel like then? What do you want to tell them now?
I think naysayers have a role. They sort of keep you honest. There are two types of naysayers. There are those naysayers in your family who will possibly say they are saying it because they want to protect you.
Want the best for you.
Those who actually are naysayers but never say it on your face are the ones you never hear from anyways. So it does not matter. So I think most people say that from a point of protecting you and that opinion. What you need to take away from that is to figure out what is the objective line in it. So why will people trust to buy jewellery online was the objective line. And all these years we have been sitting and sort of answering that question. It is not like they are wrong. We had to build an Omni business to become really successful.
Where was the first store that you opened? Was it in Delhi?
It was in Delhi. We opened the first store at Delhi.
So what was that thinking of, we need to shift the strategy, move to omni channel. How did that work initially? Was that a lot of capex?
No, actually we had a view that it has to be omni all throughout. We just did not know the word because the word sort of came by later. What we did get terribly wrong is that the first store that we opened up was completely tech.
No jewellery I believe.
No jewellery in it at all or very little jewellery. And all those who were visiting the website came to the store like, where is the jewellery? And we are like, we thought we could just come and play here. We had to redo that whole thing. Then the second store we opened, we got the location wrong. We got the size wrong. For the size of jewellery we are, I think the architect designed the store where the bus were too large and the spaces were too large and so they are not used to everyday jewellery either, so cannot blame them.
So we got that wrong. It is only the third one that opened up in Bangalore at Phoenix where we solved for all of this. So that iterative process and being at it, very easy I mean we could have said, just shut this down, stores do not work.
Yeah, but you worked on it.
We have worked on it. Same with the try at home, we failed three times. It is the fourth time we got it right. The fourth iteration that we got it right so I feel it is just the Indian consumer is different from consumers any other part of the world and some of the ideas often come from different parts of the world but you have to find your own Indian tadka to it. If you do not find that, these things do not play out.
