Kalyan Jewellers, one of India’s largest jewellery retail chains, saw a notable surge in its stock price after announcing its Q3 business update. The company reported an impressive 39% year-on-year revenue growth for the December quarter, reflecting a robust business performance despite external challenges. The stock price peaked at ₹781 during intraday trading, marking a 5% increase, before settling slightly lower by the end of the session. The positive market response came amid strong revenue growth and continued expansion plans, positioning Kalyan Jewellers well for sustained success.
Key Highlights from Q3 Business Update:
Revenue Growth: A Solid Performance Kalyan Jewellers posted an impressive consolidated revenue growth of 39% compared to the same period last year. The company’s India operations, which contribute significantly to its overall revenue, saw a stellar growth of approximately 41%. This growth was primarily driven by robust festive demand and an uptick in weddings, a time when jewellery purchases are traditionally high. The festive and wedding season provided a much-needed boost for the company, with both gold and studded jewellery seeing high demand.
Same-Store Sales Growth: Reflecting Strong Demand One of the most encouraging figures from Kalyan Jewellers’ Q3 report was its same-store sales growth (SSSG), which came in at a healthy 24%. This metric is often considered an indicator of a company’s performance in terms of organic growth, excluding new store openings. A 24% increase in SSSG suggests that existing stores are continuing to perform well, driven by the demand for high-quality jewellery. This growth is a clear reflection of the brand’s increasing popularity and the continued demand for luxury and wedding jewellery in India.
International Performance: Middle East Segment Shows Strength While the majority of Kalyan Jewellers’ business is rooted in India, its international operations have been crucial in diversifying its revenue streams. The company’s Middle East segment, which has long been a key contributor to its bottom line, recorded a solid 22% increase in revenue during the quarter. This segment now contributes approximately 11% to the company’s consolidated revenue, highlighting the importance of international markets in Kalyan Jewellers’ overall business strategy. The Middle East remains an essential market, driven by the large diaspora and the region’s affinity for gold jewellery.
Expansion Plans: Aggressive Growth Strategy Kalyan Jewellers is aggressively expanding its footprint, both in India and abroad. In Q3 alone, the company inaugurated 24 new showrooms across India, a testament to its expanding presence in the country’s competitive jewellery market. Moreover, the company’s expansion plans for the current quarter include the opening of an additional 30 Kalyan showrooms and 15 Candere showrooms. The company also made a significant international move by launching its first showroom in the United States, marking a critical step in its global expansion strategy. These showrooms will provide the brand with increased visibility and accessibility, both in existing and new markets, helping Kalyan Jewellers maintain its competitive edge.
Digital Growth: A Digital-First Approach In addition to its physical expansion, Kalyan Jewellers has embraced the digital transformation of the jewellery industry. Candere, the company’s digital-first jewellery platform, continues to perform well, with a substantial year-on-year revenue growth of 89%. This reflects the growing demand for online jewellery shopping, a trend that has accelerated during the COVID-19 pandemic and continues to thrive in the post-pandemic era. With a focus on convenience, an extensive range of jewellery, and an easy-to-navigate website, Candere is well-positioned to capitalize on the growing online shopping trend in India and beyond.
Market Reaction: Volatility Amid Strong Results
Following the announcement of Kalyan Jewellers’ Q3 update, the stock experienced an initial surge of up to 5%, reaching an intraday high of ₹781. However, the stock later pared its gains, closing down by about 0.66% at ₹739. This volatility suggests some profit booking and investor caution despite the strong quarterly results.
Despite this small pullback, Kalyan Jewellers’ stock has experienced significant gains over the past year. It has more than doubled in value, reflecting a growth of approximately 104%, which significantly outpaces the performance of the broader Nifty50 index. This substantial increase in stock price highlights investor confidence in the company’s long-term prospects and its ability to capitalize on the booming jewellery sector in India.
Looking Ahead: Kalyan Jewellers’ Growth Outlook
Kalyan Jewellers is strategically positioning itself for future growth with a focus on both physical and digital expansion. The company’s ongoing investments in new showrooms, along with the growing success of its digital platform, are expected to provide it with a strong foundation for the future. As consumer demand for jewellery continues to rise, particularly in India, the company is likely to see continued growth in both revenue and market share.
Furthermore, with the expansion of its international operations and the successful entry into the United States market, Kalyan Jewellers has the potential to become a global leader in the jewellery industry. The company’s ongoing focus on providing high-quality products and an exceptional customer experience will be key to sustaining its growth trajectory.
Conclusion: A Strong Performer in the Jewellery Sector
Kalyan Jewellers’ Q3 update reflects a solid business performance, characterized by strong revenue growth, increased same-store sales, and significant progress in both domestic and international expansion. The company’s focus on digital growth through Candere and its continued efforts to expand its showroom network highlight its forward-thinking approach to the evolving jewellery market.
While the stock experienced some volatility following the announcement, Kalyan Jewellers remains well-positioned for the future. With strong consumer demand, a robust expansion strategy, and a focus on digital innovation, Kalyan Jewellers is likely to continue its upward trajectory and remain a leader in the Indian jewellery market. Investors will likely continue to keep a close eye on the company’s performance, particularly in terms of how it balances its traditional retail operations with its digital-first approach.
