Significant wedding and holiday demand is expected to fuel jewelry companies’ significant year-over-year revenue increase for the October–December quarter, according to analysts and company reports. By lowering the import tax on gold from 15% to 6% in the FY25 Union Budget, organized players were greatly aided.
Kalyan Jewellers said in its quarterly business update on Tuesday that its consolidated revenue for Q3FY25 increased 39% year over year. A 24% increase in same-store sales growth (SSSG) helped its India business report a 41% revenue gain.
In an update issued on Monday, Titan Company also reported an outstanding result, with its domestic jewelry business expanding 25% year over year due to robust customer demand throughout the holiday season.
Another factor driving jewelry majors’ revenue growth has been their quick store development into tier-2 and tier-3 cities. Analysts predict that jewelry majors would see quarterly revenue rise of 25% to 30% YoY. Motilal Oswal predicts growth of 31%, while Nuvama Institutional Equities anticipates growth of 24%.
EBITDA (earnings before interest, taxes, depreciation, and amortization) and profit after tax are expected to increase by roughly 20% and 18% year over year, respectively.
Strong topline growth nevertheless, certain difficulties still exist. The import duty drop may result in short-term losses for retailers who use formal hedging for gold purchases, which would cause their margins to contract. Sequential financial performance might also stay unchanged because Q2FY25 previously showed strong revenue growth.
