Financial Performance Highlights

Full Year FY26 Performance:

  • Total Income: ₹2,051.02 crores, representing 15.71% year-on-year growth
  • EBITDA: ₹126.99 crores, showing 95.69% year-on-year growth
  • EBITDA Margin: 6.19%, improved by 253 basis points year-on-year
  • Profit After Tax: ₹89.42 crores, registering 98.87% year-on-year growth
  • PAT Margin: 4.36%, improved by 182 basis points year-on-year
  • EPS: ₹36.10, increased by 98.57% year-on-year

Second Half FY26 Performance:

  • Total Income: ₹1,098.26 crores, showing 8.1% year-on-year growth
  • EBITDA: ₹73.21 crores, registering 102.79% year-on-year growth
  • EBITDA Margin: 6.67%, improved by 312 basis points year-on-year
  • Profit After Tax: ₹50.72 crores, reflecting 103.6% year-on-year growth
  • PAT Margin: 4.62%, improved by 217 basis points year-on-year
  • EPS: ₹20.46, registered 103.18% year-on-year growth

Business Operations and Strategy

Khazanchi Jewellers is a legacy jewelry company with over 5 decades of experience operating across both wholesale and retail segments. The company offers diversified products spanning gold, diamond, and precious stone jewelry supported by a strong design library and asset-light manufacturing model.

Business Segments:

  • B2B Segment: Services over 1,000 clients across India with large volume orders, design differentiation, and timely execution
  • B2C Segment: Successfully launched and scaled a large-format flagship showroom in Chennai to enhance brand visibility and capture higher-margin opportunities
  • Premium Segment: Strategic focus on premiumization through diamond jewelry segment under brand Vajraa Diamonds

Management Commentary and Outlook

Management expressed confidence in the long-term outlook for the jewelry industry, noting gold's deep cultural embeddedness in Indian traditions, weddings, and festivals. The company is building a foundation for sustainable growth by creating a balanced revenue mix across B2B, B2C, and future e-commerce channels.

Growth Targets:

  • Targeting 25-30% growth trajectory
  • Aiming to increase retail contribution from current levels to 25% of total sales within 2 financial years
  • Retail segment margins expected to be in the range of 10-12%

Response to Government Policy

Management addressed Prime Minister Modi's recent appeal for citizens to reduce gold purchases, viewing it as having only short-term impact. The company believes:

  • Gold purchases are essential for Indian customs and ceremonies
  • Gold serves dual purpose as tradition requirement and secure long-term asset
  • Government initiatives on gold monetization could help reduce import dependence
  • No significant impact on margins observed currently

Operational Metrics

Inventory Management:

  • Current inventory: Approximately ₹408 crores
  • Inventory cycle: 70-75 days (increased due to retail store expansion)
  • Working capital cycle: 52 days
  • Inventory turnover target for retail: 3-4 turns annually

Customer Base:

  • B2B client network: Over 1,000 clients across India
  • Repeat customer rate: Approximately 80% of B2B clients are repeated customers
  • Retail average ticket size: ₹1.5-1.7 lakhs

Expansion Plans

  • Planning additional retail showrooms beyond current Chennai flagship store
  • Initial expansion focus: Surrounding Tamil Nadu regions
  • Future expansion: Pan-India presence
  • Funding: Initially through internal accruals; external fundraising if required will be disclosed

Risk Factors

Management addressed several operational aspects:

  • Gold price volatility: Well-managed through inventory management and pricing policies
  • Competitive landscape: Differentiated through design innovation and legacy expertise
  • Transition to retail: Not new for company given 5-decade legacy in both segments

Q2 FY27 Business Trends

Management expressed positivity about April-May FY27 performance, noting:

  • Sustained customer footfalls in retail segment
  • Confidence in achieving 25-30% growth target for FY27
  • No significant demand slowdown despite elevated gold prices