Kalyan Jewellers Rallies 9%, Extending Rally to Third Day After Business Update

Mumbai, July 10: Kalyan Jewellers India share price rose for a third straight session on Friday, climbing as much as 9% as investors continued to cheer the jewellery retailer’s strong June-quarter business update and an upbeat brokerage view. 

The stock has now surged around 34% over the past three trading sessions, adding nearly Rs 11,500 crore to the company’s market capitalisation. The sharp rebound comes after the stock had come under pressure earlier this week despite reporting robust quarterly business growth, highlighting a swift turnaround in investor sentiment. As of writing, the stock was up 6.6% at Rs 472. 

Brokerages drives momentum 

The latest leg of the rally has largely been fuelled by bullish notes from brokers, which reiterated ‘Buy’ rating on the stock despite the company’s June-quarter revenue growth falling slightly short of their expectations. 

Stock keeps on rising as business update continues to spread cheer. Source: NSE  

Target prices implied significant upside from recent trading levels. One brokerage said Kalyan Jewellers’ long-term growth story remains intact, supported by its franchise-led expansion strategy, improving return on capital and accelerating growth in its digital jewellery platform, Candere.  

The brokerage believes the company’s asset-light expansion model will enable it to continue adding stores at a healthy pace while requiring lower capital investment than company-owned outlets. It also highlighted the rapid scaling of Candere, which continues to strengthen Kalyan’s omnichannel presence. 

Strong Q1 business update 

The renewed buying interest follows Kalyan Jewellers’ June-quarter business update, which pointed to healthy demand across domestic and international markets despite a challenging operating environment. 

The company reported 38% year-on-year consolidated revenue growth during the April-June quarter. Its India business grew by approximately 38%, supported by a robust same-store sales growth of around 28%, while the international business expanded by 35%, led by nearly 30% growth in West Asia. 

International operations contributed around 14% of consolidated revenue during the quarter. Meanwhile, Candere emerged as the standout performer, delivering an impressive 112% year-on-year jump in revenue as the company continued to expand its physical store network alongside its online business.  

The retailer also maintained an aggressive expansion strategy during the quarter, opening 12 Kalyan showrooms and five Candere outlets, while management indicated that business momentum had continued into the current quarter ahead of the festive and wedding season.  

From sharp sell-off to strong rebound 

Interestingly, the recent rally comes after a sharp correction earlier in the week. On Monday, Kalyan Jewellers’ shares had slumped nearly 8% despite the strong quarterly update, as investors compared its growth with larger rival Titan and judged the numbers against elevated market expectations. 

However, sentiment shifted quickly after brokers reaffirmed bullish stance, arguing that the temporary revenue miss did little to alter the company’s long-term growth trajectory. Since then, the stock has recovered strongly, erasing much of the earlier decline and significantly outperforming the broader market.  

What investors are watching 

While the recent rally underscores renewed confidence in Kalyan Jewellers’ growth prospects, analysts believe the focus will now shift to the company’s upcoming quarterly earnings for confirmation that strong revenue growth translates into healthy profitability and margins. 

Investors will also watch whether the company’s franchise-led expansion, continued momentum in Candere and sustained demand during the festive season support further earnings upgrades. Given the sharp run-up in the share price over the past three sessions, traders may also remain alert to bouts of profit booking, although brokerage optimism suggests the market continues to view Kalyan Jewellers as one of the stronger growth stories in India’s organised jewellery retail sector. 

Source

• https://www.nseindia.com/get-quote/equity/KALYANKJIL/Kalyan-Jewellers-India-Limited