Shree Ganesh Jewellery House lays off 100 employees

Shree Ganesh Jewellery House engaged in manufacturing and exports of gold and diamond jewellery, which at present is trying to curtail all the ‘unnecessary expenditure’ has laid off more than 100 employees, top gem and jewellery source said on the condition of anonymity.

Also, the Kolkata headquartered company has closed around 5-6 retail showrooms of GAJA on finding it unprofitable.

In addition, it is learnt that the Kolkata corporate office is closed. “Employees when come to office are asked to go back making them believe that renovation work is on and soon everything would be fine,” said a company insider.

When the Shree Ganesh Jewellery House official was contacted, he refused to talk.

Industry sources said the company could not garner business as expected. “We could sniff from last some months that the company might be in trouble,” they said.

While another said Shree Ganesh Jewellery House is not of a retail jeweler mentality. “The group closed the Gaja outlets which were not profitable,” he said.

A company insider added that since there was not much work order on the back of subdued sentiments, more than 100 people are asked to leave the company.

Meanwhile another source said the company is scouting for 2,000 sqft to open a big store of Gaja.

A jeweller said more than 25 jewellers purchased raw gold from the company in Kolkata but at present the company does not deal in raw gold any more.

The company reported a mere two per cent rise in net profit in the April-June quarter. Though domestic sales moved up by a whopping 2.5 times, riding primarily on bullion trade, volatility of rupee and lower sales in West Asia had impacted the bottom-line.

The promoters recently, infused Rs 140 crore equity through fresh issue of shares to meet the ongoing capacity expansion in its integrated manufacturing facility at Domjur, Howrah, 30 km from the city; setting up new retail stores and working capital requirement.

The capital infusion has increased promoter’s stake to 74.79 per cent from 72.54 per cent.

On Thursday morning, the scrip was trading at Rs 56.15 up 0.50 points or 0.90 per cent.

According to the exchange data, the scrip was trading at Rs 139.40 at 52 week high on January 9, 2013. While yesterday it closed at Rs 53.65, the lowest record in last 52 weeks.