Senco Gold tanks 20%, nears 52-week low on weak Q3 operational performance

Senco Gold share price: The company's management said it is likely to achieve 7-8% Ebitda margin in Q4 going forward based on its brand positioning

Senco Gold share price was locked in the 20-per cent lower circuot, Rs 357.6 per share, on the BSE in Friday's intraday trade amid heavy volumes. Thee decline in Senco Gold shares after the company reported weak operational performance in the December 2024 quarter. The company's adjusted earnings before interest, tax, depreciation and amortisation (Ebitda) margin contracted to 5.1 per cent in December 2024 quarter (Q3FY25) from 11.0 per cent in Q3FY24. The company had guided for an Ebitda margin in the range of 7 per cent and 8 per cent.

 

The company’s profit after tax declined 69 per cent year-on-year (YoY) to Rs 33.48 crore, compared to Rs 109.32 crore in Q3FY24. The company reported lower Ebitda and profit after tax (PAT) in the quarter due to custom duty impact of Rs 57.4 crore.

 

 

The management believes that with the full impact of the custom duty reduction already factored in in the 9-month results; and considering the present vibrant demand, the company will be able to deliver 14-15 per cent gross margin and 7 per cent-8 per cent Ebitda margin.

 

At 11:15 AM, Senco Gold was locked in the stock's down limit as compared to a 374-ppint (0.49 per cent) decline in the BSE Sensex. The average trading volume on the counter nearly doubled, with a combined 4.46 million equity shares changing hands on the NSE and BSE so far in the session. The stock is trading near its 52-week low of Rs 342.55, which it touched on March 14, 2024. It has corrected 53 per cent from its 52-week high level of Rs 772 hit on October 7, 2024.

 

However, in Q3FY25, Senco Gold reported its highest-ever quarterly performance with 27.3 per cent Y-o-Y jump in revenue from operations at Rs 2,102.5 crore, against Rs 1,652.2 crore in the year-ago quarter. The reduction in customs duties during Q2 rather acted as a tailwind for Q3 sales, especially during Dhanteras and Diwali, the company said.

 

The management remains confident that given the long-term prospects of the Indian gems and jewellery industry, which is presently at $85- 90 billion, the company will achieve 7-8 per cent Ebitda margin on an annualised basis excluding any one-off event.

 

The management said the company is likely to achieve 7-8 per cent Ebitda margin in Q4. And going forward, based on the company’s brand positioning and operating leverage, it will try to further improve sales by bringing innovative offerings and premium pricing and by being the second most trusted brand in the jewellery domain, they added.

 

Senco Gold & Diamonds offers an extensive range of jewellery products, including gold, diamond, Polki, Platinum, Kundan, Jadau, silver, as well as precious and semi-precious stones. With a catalogue offering more than 177,400 designs for gold jewellery and more than 98,200 designs for diamond jewellery, Senco offers a large variety of designs of handcrafted jewellery, most of which are designed in-house by its designers in close collaboration with skilled local karigars in Kolkata and across the country.