Kalyan Jewellers shares climbed 5% today; will this upmove sustain?
Kalyan Jewellers share price: The stock moved up 4.79 per cent to hit a day high of Rs 509.30. It was last seen trading 1.55 per cent higher at Rs 493.55. At this price, the scrip has corrected 37.88 per cent from its all-time high value of Rs 794.60.
- Jan 23, 2025,
- Updated Jan 23, 2025 2:04 PM IST
Kalyan Jewellers India Ltd shares rebounded in Thursday's trade, snapping their two-day fall. The stock moved up 4.79 per cent to hit a day high of Rs 509.30. It was last seen trading 1.55 per cent higher at Rs 493.55. At this price, the scrip has corrected 37.88 per cent from its all-time high value of Rs 794.60, seen on January 2 this year.
There has been a recent drop in Kalyan's share price even as the company denied talks of IT raids and bribing a few fund managers. In an earnings audio call, the jewellery maker stated that no IT raids had been conducted at its premises and termed bribery allegations 'absurd'.
Ramesh Kalyanaraman, executive director at Kalyan Jewellers, said, "Very absurd allegation. We have always conducted our businesses and interactions with all stakeholders with a very high level of integrity and transparency."
"There have been no raids at any of our premises. It was just a rumour. Inventory level, as mentioned in our financial statement, goes through multiple levels of audit. We've repaid around Rs 450 crore debt over the last 18 months. This is in addition to around Rs 170 crore dividend payout," Kalyanaraman added. The company is scheduled to declare third quarter (Q3 FY25) results on January 30.
A market expert said investors should tread cautiously in Kalyan's stock for the near term as it is currently fully priced in. "The stock rallied impressively over the last three years, from around Rs 100 to a high of Rs 795, marking its place as a multibagger. This growth was supported by improved earnings during this period. The stock has almost doubled in the past year, which makes it fully priced in at current levels. With the stock now in the F&O segment, there is room for short positions, adding to the volatility. Additionally, recent developments, including promoter pledges, may weigh on investor sentiment. If the pledged shares face margin pressure and the requirements are not met, it could lead to selling in the open market, which acts as a negative factor for the stock price," said Kranthi Bathini, Director of Equity Strategy at WealthMills Securities.
While the overall fundamentals remain strong, the stock's near-term outlook is subject to these pressures and investors should tread cautiously, he added.
At least four other analysts suggested avoiding the counter and said those holding may consider booking profits. "The expected trading range will be between Rs 440 and Rs 525 for the short term. Traders can avoid this counter at the current market price," said Jigar Patel of Anand Rathi.
Religare Broking's Ravi Singh recommended that investors should exit the counter. "We advise refraining from purchasing it and advising those currently holding to consider booking profits," said StoxBox's Kushal Gandhi. Osho Krishan of Angel Broking also proposed avoiding Kalyan Jewellers at the current market price.
BSE data showed that the jewellery maker's promoters Ramesh Kalyanaraman and Seetharam Kalyanaraman raised their pledged holdings with select financial institutions by 1.65 per cent and 1.85 per cent, respectively.
As per BSE data, promoters held a 62.85 per cent stake in the company.
Kalyan Jewellers India Ltd shares rebounded in Thursday's trade, snapping their two-day fall. The stock moved up 4.79 per cent to hit a day high of Rs 509.30. It was last seen trading 1.55 per cent higher at Rs 493.55. At this price, the scrip has corrected 37.88 per cent from its all-time high value of Rs 794.60, seen on January 2 this year.
There has been a recent drop in Kalyan's share price even as the company denied talks of IT raids and bribing a few fund managers. In an earnings audio call, the jewellery maker stated that no IT raids had been conducted at its premises and termed bribery allegations 'absurd'.
Ramesh Kalyanaraman, executive director at Kalyan Jewellers, said, "Very absurd allegation. We have always conducted our businesses and interactions with all stakeholders with a very high level of integrity and transparency."
"There have been no raids at any of our premises. It was just a rumour. Inventory level, as mentioned in our financial statement, goes through multiple levels of audit. We've repaid around Rs 450 crore debt over the last 18 months. This is in addition to around Rs 170 crore dividend payout," Kalyanaraman added. The company is scheduled to declare third quarter (Q3 FY25) results on January 30.
A market expert said investors should tread cautiously in Kalyan's stock for the near term as it is currently fully priced in. "The stock rallied impressively over the last three years, from around Rs 100 to a high of Rs 795, marking its place as a multibagger. This growth was supported by improved earnings during this period. The stock has almost doubled in the past year, which makes it fully priced in at current levels. With the stock now in the F&O segment, there is room for short positions, adding to the volatility. Additionally, recent developments, including promoter pledges, may weigh on investor sentiment. If the pledged shares face margin pressure and the requirements are not met, it could lead to selling in the open market, which acts as a negative factor for the stock price," said Kranthi Bathini, Director of Equity Strategy at WealthMills Securities.
While the overall fundamentals remain strong, the stock's near-term outlook is subject to these pressures and investors should tread cautiously, he added.
At least four other analysts suggested avoiding the counter and said those holding may consider booking profits. "The expected trading range will be between Rs 440 and Rs 525 for the short term. Traders can avoid this counter at the current market price," said Jigar Patel of Anand Rathi.
Religare Broking's Ravi Singh recommended that investors should exit the counter. "We advise refraining from purchasing it and advising those currently holding to consider booking profits," said StoxBox's Kushal Gandhi. Osho Krishan of Angel Broking also proposed avoiding Kalyan Jewellers at the current market price.
BSE data showed that the jewellery maker's promoters Ramesh Kalyanaraman and Seetharam Kalyanaraman raised their pledged holdings with select financial institutions by 1.65 per cent and 1.85 per cent, respectively.
As per BSE data, promoters held a 62.85 per cent stake in the company.