Kalyan Jewellers shares Q1 update, says revenue up 31% but blended gross margin falls

Shares of Kalyan Jewellers will be in focus on Friday after the jewellery maker said its consolidated revenue for the June quarter rose 31 per cent on an year-on-year basis, thanks to continued momentum in both footfalls and revenue across markets in India and Middle East. Kalyan Jewellers said its India operations grew 34 per cent.

In a filing to BSE, Kalyan Jewellers said its operating momentum was consistent and sustained through the entire quarter, including during Akshaya Tritiya, underpinning the resilience of its category within the overall consumption basket. 

"While momentum in same store revenue growth was broad-based across geographies, non-south markets recorded higher overall revenue growth largely due to the greater number of showrooms launched in that region over the last twelve months," it said.

Kalyan Jewellers said gross margin at the showroom level improved YoY and was broadly in line with the prior quarter. Given the higher share of revenue from franchised showrooms, blended gross margin declined sequentially and YoY.

Kalyan Jewellers added 12 new ‘Kalyan’ showrooms across non-south markets during the quarter and expects to launch 20 new showrooms across non-south markets before Diwali, as part of its previously communicated plan of launching 52 new showrooms during the ongoing year.

"In the Middle East, we continued to witness robust momentum in footfalls and revenue driven by strong economic activity in the region. Revenue growth for the recently concluded quarter was 21 per cent. The growth in the recently concluded quarter was predominantly same-store-sales driven since network expansion in the region during the last twelve months has not been meaningful. Eid holidays-driven sales, which was not part of the base quarter revenue in the prior year, also contributed to the higher than usual same-store-sales growth during the recently concluded quarter," Kalyan said.

Kalyan expects to launch the first FOCO (Franchisee Owned Company Operated) showroom in the region during Q2 FY 2024.

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