On September 13, Gerald Charles SA CEO Federico Ziviani came to Mumbai to celebrate the Swiss luxury watchmaker’s entry into the Indian market in partnership with Himachal Pradesh-based Ethos Ltd, which operates more than 60 high-end watch boutiques in India.
The family-owned watch company, which counts Indian cricket captain Rohit Sharma among its fans, is known for its exclusivity and produces just 1,600 of its exquisite watches each year.
Ziviani believes the country will have a large enough market to produce custom, hand-crafted watches that will sell for ₹2.1 million to ₹50 lakh.
The same is true for other high-end brands.
As the annual holiday season approaches, a host of new and transitional luxury brands are seeking out affluent consumers in China.
The new luxury market
A deepening economic slowdown in China is forcing the world’s most expensive brands to look to its southern neighbour, which is home to 849,000 millionaires, according to UBS’s 2023 Global Wealth Report.
Last week, just as Gerald Charles was launched, Helios Watch Store, owned by Titan Co. Ltd., introduced Italian luxury watch brand U-Boat to India, which has imported watches worth 139.5 million Swiss francs in the first seven months of 2024, an increase of 20% and 41% over the same period in 2023 and 2022, respectively.
To be sure, some of this growth could be explained by the rupee’s depreciation against the Swiss franc. ₹99.5, compared to ₹In 2022 it was 77.8.
U-Boat founder Italo Fontana also came to Delhi to attend the launching ceremony. He told Mint In response to the sluggish demand in the Chinese market, the company is currently focusing its business on emerging regions such as India and the Middle East. Although their business in China is still small, they hope to develop their business in India.
In October, French accessories brand ST Dupont will open stores in Mumbai and Delhi.
Existing brands are also seeking to gain more space and presence in India, where the luxury goods market is expected to be worth about $30 billion by 2030, according to management consultancy Deloitte India.
On September 17, luxury watch brand Franck Muller opened its first mono-brand boutique at Delhi’s posh DLF Emporio mall.
“Luxury Watch Collection ₹Watches in the Rs 3.5-8 lakh range have become highly giftable items. This is probably why many watch brands, which already have a presence in India through the shop-in-shop model with local retailers, are expanding through their own flagship/exclusive stores,” Pushpa Bector, senior executive director and business head, DLF Retail, told Mint.
“Many men and women are interested in wearing jewelled watches as a way to show their individuality. This is also driving the overall sales of the category,” she added.
On September 18, Ethos announced a partnership with another Swiss watchmaker, Hautlence, which came as no surprise.
Ethos has seen strong growth since its IPO in 2022. ₹Net profit for 2023-24 is Rs 998 crore, up more than 25% from 2022-23. Net profit also rose to ₹82.8 crore in FY2024, up 37% from FY2023 ₹601 Crores.
Ethos shares closed down about 1% on Thursday. ₹3,342.80 on the Bombay Stock Exchange (BSE).
Many other watch brands, including Breitling, Breguet, Jacob & Co., Rolex and Franck Muller, have opened or are in the process of opening flagship stores at DLF’s two luxury malls in the Indian capital.
ST Dupont products are ready to ship from France. The company makes high-end bags, watches, lighters and other accessories. Its jewel-encrusted lighters can cost up to 125,000 euros or ₹1.1 crore, and 88,000 Euros or ₹Tiger fountain pen is priced at Rs 8.1 lakh. This will be the brand’s second entry into the Indian market; the first was about a decade ago in 2015 when the Indian luxury market was still in its infancy.
“This time, we will not rush,” said Sara Taha, ST Dupont’s regional manager for the Middle East, Turkey and India. “India is a key market for the luxury industry, which we unfortunately had to leave a few years ago. Now we have found the right partner to return to the market. We will provide a tailor-made service to our existing loyal customers and potential customers,” she added.
The company is entering the Indian market in partnership with Delhi-based Luxury Ampersand Frolics, which provides consultancy services to luxury brands.
The company’s founder, Raahuul Kapoor, said they have seen a continued rise in cigar sales and a corresponding increase in demand for accessories. “This year, price seems to no longer be a barrier to luxury consumption and quality seems to be back in the spotlight,” he said.
The middle class is expanding
India’s GDP grew 8.2% in fiscal 2024. As the country grows, so does its middle class and consumer spending. Deloitte economists estimate that one in four households currently fall into the upper-middle income ($4,000 to $8,500 per household) and high-income ($40,000 and above) categories. By 2030, one in two households is expected to reach these income levels.
This is corroborated by the UBS 2023 Global Wealth Report, which shows that wealth per adult in India has grown by an average of 8.7% per year since 2000, reaching $16,500 by the end of 2022.
This is evidenced by the earnings of some luxury brands operating in the country.
Louis Vuitton India Retail Private Limited is the Indian subsidiary of the Paris-based LVMH Group. ₹Sales in fiscal 2023 reached Rs 719 crore, up 33% from fiscal 2022. Its net profit increased by 37% to ₹140 crore, up from Rs. ₹102.4 crores.
Rival Hermès, which operates its India business through local partners under the umbrella of Hermès India Retail and Distributors, saw sales rise 42%. ₹249.4 crore in FY2023 and Rs. ₹1754 crore. Its profit is ₹5.43 billion, an increase of 31% over the previous year ₹414 million rupees.
Similarly, Christian Dior (retailed as Christian Dior Trading India Pvt. Ltd) reported a 20% year-on-year growth in revenue to ₹183.22 crore in FY2023 compared to FY2022 ₹152.6 crore. However, its profit fell to ₹Rs.321.3 crore ₹The loss last year was Rs 35.59 crore due to high expenses.
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