Kalyan Jewellers hits record high in subdued market; zooms 134% in 3 months

Shares of Kalyan Jewellers India rallied 6 per cent to hit a record high of Rs 246.95 on the BSE in Thursday’s intra-day trade on the back of heavy volumes. In comparison, the S&P BSE Sensex was down 0.05 per cent at 65,051 at 10:55 am. The counter saw large trading activity with a combined 3.2 million shares having changed hands on the NSE and BSE so far.

In the past three months, the stock price of Kalyan Jewellers has zoomed 134 per cent on strong earnings for the June quarter (Q1FY24) and healthy business outlook. The company clocked a 31 per cent year-on-year (YoY) jump in consolidated revenue from operations to Rs 4,387 crore in Q1FY24.

In Q1FY24 earnings call, the company said it witnessed continued robust momentum in footfalls across all markets in India and Middle East over the last several quarters now.

The management is upbeat about the upcoming new showroom launches and said they are gearing up with fresh collections and campaigns for the upcoming festive and wedding season across the country. The company has ambitious plans to open over 50 showrooms in FY24.

In its FY23 annual report, the company said that organised jewellery retailers are expected to achieve strong revenue growth of 23-25 per cent this fiscal. This growth is driven by pent-up demand and a recovery in discretionary spending, following a 36 per cent increase in the previous fiscal.

The sales volume is expected to rise, reflecting the release of pent-up demand and renewed consumer confidence. This positive trend underscores the resilience and potential of the organised gold jewellery retail sector.

Rating agency ICRA predicted a promising future for India’s organised jewellery retailers. With an estimated average revenue growth of 20 per cent in FY23 and a steady 10 per cent growth in FY24, the organised sector is poised to outperform the industry in the medium term, it said. 

This positive outlook reflects the resilience and potential of organised jewellery retailers in India’s dynamic market. This industry is projected to maintain a stable outlook, with ICRA forecasting year-on-year growth of approximately 15 per cent for this fiscal year.

The optimistic projection highlights the industry’s resilience and indicates favourable conditions for growth and expansion. As the demand for gold jewellery continues to thrive, the industry is expected to capitalise on emerging opportunities and sustain its upward trajectory, it said.