Revenue stood at ₹101.38 crore, a 124.69% increase from ₹45.12 crore in Q1 FY26.
EBITDA increased to ₹4.64 crore from ₹1.58 crore YoY; EBITDA margin improved to 4.58% from 3.5%.
PAT increased to ₹2.38 crore from ₹0.57 crore YoY; PAT margin improved to 2.35% from 1.26%.
EPS for the quarter was ₹3.94, compared to ₹1.26 in Q1 FY26.
Operational and Business Updates
The company added 12 independent jewellery retailers during the quarter and expanded engagement with established retail and corporate customers.
90-95% of revenue is currently from Kerala, with plans to expand to other regions of India; a marketing team is operational in Chennai.
Technology upgrades were completed for the B2B digital portal and ERP platform. The platform features a design library with 2.5 lakh designs.
A dedicated design and innovation center was established, with a team of 20 skilled designers (manual and CAD).
The company launched its silver jewellery direct-to-consumer brand, Esthara, which currently has three operational stores in Kerala. Two additional stores are under fit-out and expected to open by the end of October 2026.
Esthara targets Gen Z customers; the first store generates approximately ₹15 lakh in revenue per month. Capex per store is approximately ₹4,000 per square foot, with operational expenditure of ₹5-6 lakh per store.
The company does not engage in bullion trading or gold metal loans.
Proposed Acquisition
The company announced a proposed acquisition of an 80% stake in AJC Jewel Manufacturers FZC, Sharjah, UAE.
The transaction is valued at up to ₹9.6 crore and will be structured entirely through a non-cash share swap, expected to result in 7-8% dilution for existing investors.
The acquisition is subject to BSE and other regulatory approvals, with an expected completion timeline of 3-6 months.
The UAE entity reported revenue of ₹127.95 crore in calendar year 2025 and ₹72.46 crore for January to June 2026.
The UAE entity has an EBITDA margin of approximately 5% and a PAT margin of 4%, benefiting from its location in a tax-exempt free zone.
This acquisition was previously announced in November 2025 but was delayed due to geopolitical issues; the process has now been re-initiated.
Capacity and Utilization
India Gold Jewellery Capacity: 5 kg per day (casting jewellery). Current utilization is 25% (1.2 kg per day).
India Silver Jewellery Capacity: 8 kg per day. Current utilization is approximately 12.5% (1 kg per day).
Sharjah Gold Jewellery Capacity: 3 kg per day. Current utilization is approximately 26.7% (800 grams per day).
At 100% utilization, the India entity can generate roughly ₹7 crore in revenue per day, and the Sharjah entity can generate ₹3.6 crore per day.
Achieving higher utilization requires intensive working capital, which may be funded through internal accruals, debt, or future equity fundraising.
Guidance and Outlook
For FY27, the company provided standalone revenue guidance of ₹450 crore for its India operations.
Management targets a 50% CAGR growth for the next three years, primarily driven by volume growth.
The company expects to consolidate the UAE entity's results from Q3 FY27 onwards.
Focus areas include improving margins through product mix changes (introducing higher-margin 9-karat and 18-karat products), controlling manufacturing wastage, and expanding into new geographical markets.
Financial Management
The company uses hedging facilities with suppliers and MCX to mitigate gold price fluctuation risks.
Receivables have grown due to the addition of corporate clients who have longer credit periods; management is focused on reducing debtor days.
Cash flow from operations has been negative for the past six years; management aims to improve this in the coming years through sales volume growth and improved efficiency.
Q&A Highlights
The acquisition is intended to consolidate international operations and strengthen the UAE presence.
The company is focused on reducing customer concentration risk; currently, 50% of revenue comes from the top 10 customers.
Q2 and Q3 are typically moderate demand quarters, with higher volume expected in Q3 and Q4 due to festivals and wedding seasons.
