Thangamayil Jewellery Q2 earnings: Stock falls 7% amid decline in gross profit, EBITDA margins

Shares of Thangamayil Jewellery Ltd fell 7% on Wednesday as the company's September-quarter performance showed a sharp increase in sales but flat growth in profitability. Total sales rose 40% year-on-year (YoY) to Rs 2,381 crore, while profit after tax remained broadly unchanged at around Rs 59 crore. The company also reported a contraction in gross profit and Ebitda margins during the quarter.

The stock touched a low of Rs 4,214.70, down 7.26% from its previous close of Rs 4,544.75. It opened at Rs 4,598.95 and touched a high of Rs 4,692.35 during the session.

Thangamayil Jewellery's retail sales increased 41% YoY to Rs 2,303 crore in Q2 FY27, compared with Rs 1,636 crore in the corresponding quarter last year. Gold jewellery sales grew 41% to Rs 2,119 crore, while non-gold sales, including silver and diamond products, rose 36% to Rs 184 crore. Wholesale sales increased 13% to Rs 78 crore.

However, the growth in topline did not translate into a similar improvement in profitability. Reported gross profit increased 20% to Rs 221 crore, but gross profit margin as a proportion of retail sales declined to 9.60% from 11.25% a year ago. Ebitda rose 8% to Rs 114 crore, while Ebitda margin contracted to 4.95% from 6.48%. Profit before tax increased 3% to Rs 80 crore, while profit after tax stood at Rs 59 crore, compared with Rs 59 crore in Q2 FY26.

The company attributed some of the pressure to fluctuations in gold and silver prices. It said inventory profit realisation during the September quarter stood at Rs 28.54 crore, accounting for 12.9% of reported gross profit. It also flagged uncertainty in West Asia, which affected gold and silver prices and led to a decline in expatriate remittances in its operating regions in Tamil Nadu.

In the first half of FY27, total sales increased 55% to Rs 5,043 crore, while profit after tax rose 38% to Rs 144 crore. Same-store sales growth stood at 35.93%, compared with 10.31% in the year-ago period.