Goldiam International Limited — Q3 FY25 earnings call

Call held 11 Feb 2025

Management summary

Goldiam International delivered a strong Q3 FY25, reporting significant year-on-year and quarter-on-quarter growth in revenue, EBITDA, and PAT, driven by festive season purchases and increased contribution from lab-grown diamond jewellery. The company is actively expanding its domestic retail presence with the ORIGEM brand, planning to open 20-25 stores by December 2025, and sees continued strong demand for lab-grown diamonds in the US market, with stable pricing for low-carat LGDs.

Highlights

  • Q3 consolidated revenue at ₹288 crores, grew by 41% YoY and 104% QoQ.

  • Nine months FY25 revenue at ₹598.8 crores, grew by 29% YoY.

  • Q3 EBITDA at ₹70.8 crores, increased by 62% YoY and 105% QoQ, with an all-time high margin of 24.6%.

  • Nine months FY25 EBITDA at ₹139.7 crores, grew by 39% YoY, with a margin of 23.3%.

  • Q3 PAT at ₹49.8 crores, up by 54% YoY and 125% QoQ.

  • Lab Grown Diamonds Jewelry exports contributed 80% to overall export sales mix in Q3 FY25, up from 58% in Q3 FY24.

  • Order book position as on December 31st, 2024, stands at ₹175 crores, to be fulfilled within 3-4 months.

  • Approved Second Interim Dividend of ₹1 per equity share.

Key financials

  1. Revenue ₹288 Cr +41%YoY
  2. EBITDA ₹70.8 Cr +62%YoY
  3. EBITDA Margin 24.6%
  4. PAT ₹49.8 Cr +54%YoY
  5. Cash & Cash Equivalents ₹275.9 Cr
  6. Order Book ₹175 Cr

What they filed

Q1 FY27: revenue up 12.4%, net profit down 34.5% against the same quarter last year.

₹ Cr · quarterly
Line itemQ2 FY25Q3 FY25Q4 FY25Q1 FY26Q2 FY26Q3 FY26Q4 FY26Q1 FY27
Revenue143 204 159 133 105 −27%141 −31%151 −5%149 +12%
EBITDA21 22 17 15 15 −29%13 −41%19 +8%11 −25%
Net profit24 18 9 11 13 −44%9 −52%17 +93%7 −35%
How to read this

₹ crore, as filed. The percentage beside a figure is the change against the same quarter a year earlier — never the quarter before, which would make every seasonal business look like it collapses and booms each year.

Segment breakdown

  • Lab Grown Diamonds Jewelry Exports
    80% Contribution to Export Sales Mix
  • Online Revenue (B2B)
    28% Contribution to Q3 Revenue

Guidance & targets

Retail Expansion - ORIGEM Stores

  • Number of ORIGEM stores in Mumbai Retail Expansion - ORIGEM Stores · by March 31st, 2025 · High confidence 6
    The plan is by so March 31st, 2025 have our six stalls in Mumbai all open.

    — Anmol Bhansali

  • Number of ORIGEM stores (total) Retail Expansion - ORIGEM Stores · by December 2025 · Medium confidence 20-25
    we hope to open around 20-25 stores in that ballpark more or less by December in 2025.

    — Anmol Bhansali

  • Number of ORIGEM stores (total) Retail Expansion - ORIGEM Stores · next 3-5 years · Medium confidence 150-200
    in the next three to five years we are looking at 150 to 200 stores that we are wishing to get open now.

    — Rashesh M. Bhansali

Revenue Growth - Overall Company

  • Doubling business Revenue Growth - Overall Company · within next 4 years · Medium confidence 2x
    we are looking at doubling our business in Goldiam with the help of ORIGEM within the next four years.

    — Rashesh M. Bhansali

Revenue Growth - Export Market

  • Growth direction Revenue Growth - Export Market · ongoing · Medium confidence 10-15%
    the export market is very strong, we will grow, direction is always 10% to 15% and then we try our best to do more

    — Rashesh M. Bhansali

  • Doubling export revenue Revenue Growth - Export Market · within next 4 years · Medium confidence 2x
    if you really go to see with the help of ORIGEM, in four years, we should be doubling our current export revenue.

    — Rashesh M. Bhansali

Revenue Growth - Indian Retail (ORIGEM)

  • Retail revenue (eCommerce + stores) Revenue Growth - Indian Retail (ORIGEM) · within next timeframe (implied 1-2 years) · Medium confidence ₹90-120 crores
    if we open the 25 to 30 stores by the end of the year and if we calculate on an average 30 lakhs per store, it's very safe to say that within the next timeframe you will see an additional of 90-120 crores between eCommerce as well as store openings.

    — Rashesh M. Bhansali

Profitability - Lab-Grown Diamond Margins

  • Gross Margin (post-discounting) Profitability - Lab-Grown Diamond Margins · ongoing · High confidence 40-45%
    So, the way we are modeling is post-discounting, we will be north of 40% and we are achieving that 40% to 45%.

    — Rashesh M. Bhansali

Lab-Grown Diamond Prices

  • Price decline Lab-Grown Diamond Prices · ongoing · High confidence No further decline
    Mr. Dixit, we now do not expect any further fall in the pricing of lab-grown

    — Rashesh M. Bhansali

Risks & concerns

  • Delays in ORIGEM store openings

    medium

    Management noted that 'Retail is a segment where there could be a certain amount of delays in opening and getting there in times with the rentals and getting the right location, stuff like that.'

    Management acknowledged

  • Lab-grown diamond price decline

    low

    Management stated, 'no further room for decline in lab-grown diamond prices' and 'prices of low carat lab-grown diamonds are very stable. We have no price depreciation or reductions happening in any size in the last quarter or two quarters.'

    Management downplayed

Areas of evasion (1)

  • Specific EBITDA impact of retail operations

Q&A highlights

1 direct, 1 evasive
Discrepancy between Q3 revenue and Q2 order book, deferred sales Partial
Yes. So, that was the reason why those sales were shifted to this current year. But I think the figure was not 50 crores, we will get back to you on that figure now. But yes, there was a lag and that sales happened in this quarter.

Analyst questioned if Q3 revenue was truly strong given prior deferred sales and Q2 order book, with management acknowledging a lag but not providing the exact deferred sales figure.

Asked by Ankush Agrawal

Stock market perception of the diamond industry and Goldiam's differentiation Direct
Goldiam's operations for export are all in SEEPZ, which is the SEZ. So, we can only export, we can't sell in the domestic market. None of the exports of Goldiam go in loose diamonds which can be circulated to Dubai, Hong Kong and back Dubai, Hong Kong and back right. And that is first of all, no reason for a Company like Goldiam to sell loose diamonds, which we anyway don't. We have a zero export of loose diamond. We don't have any debt.

This question directly addressed a common investor concern about transparency and circular trading in the broader diamond industry, allowing management to clearly differentiate Goldiam's business model and governance.

Asked by Sunil Shah

EBITDA impact of retail operations (ORIGEM) in Q3 Evasive
So, can share that data, we haven't split it up at the moment, we will certainly share that data in a day or two. In the December-ending quarter, it was not very significant, especially due to growth in the business and the overall revenue pie increasing, but please give me a day or two I will ensure that we split that number out and share it as well.

Despite reporting strong overall financials and discussing retail expansion, management was unable to provide specific profitability metrics for the new retail segment, indicating a lack of immediate granular disclosure.

Asked by Anand Jain

2 min read 6 chapters

Detailed narrative

Strong Q3 FY25 Performance Driven by Lab-Grown Diamonds

Goldiam International reported a robust Q3 FY25, with consolidated revenue reaching ₹288 crores, marking a 41% year-on-year and 104% quarter-on-quarter growth. This strong performance was supported by an all-time high Q3 EBITDA margin of 24.6%, leading to a 62% YoY increase in EBITDA to ₹70.8 crores. Lab-Grown Diamonds Jewelry exports significantly contributed, accounting for 80% of the overall export sales mix in Q3 FY25, up from 58% in Q3 FY24.

Healthy Order Book and Stable Lab-Grown Diamond Prices

The company maintains a strong order book of ₹175 crores as of December 31st, 2024, which is expected to be fulfilled within the next three to four months, providing good revenue visibility. Management expressed confidence that lab-grown diamond prices, especially for low carat diamonds (below three carat), have stabilized with no further depreciation expected. This stability is crucial for maintaining healthy margins, which are targeted at 40-45% post-discounting for lab-grown diamond jewellery.

Aggressive Expansion of ORIGEM Retail Brand in India

Goldiam is rapidly expanding its domestic B2C brand, ORIGEM, with plans to open three more stores in Mumbai by March 2025, bringing the total to six in the city. The broader target is to establish 20-25 ORIGEM stores by December 2025, with further expansion to 150-200 stores within the next 3-5 years, focusing on NCR and Bangalore regions after Mumbai. The Mumbai flagship store on Turner Road, Bandra, was formally inaugurated, signaling a strong marketing push.

Promising Unit Economics for ORIGEM Stores

The initial performance of the ORIGEM stores is encouraging, with the three operational stores already achieving breakeven at the store-level, excluding head office and branding costs. The target breakeven for the general store fleet is approximately ₹30 lakhs of monthly sales per store. Management anticipates that the Indian retail business, combining e-commerce and store sales, could generate ₹90-120 crores within the next 1-2 years, driven by the planned store expansion.

Strategic Shift Towards Lab-Grown Diamonds and Deeper US Market Penetration

Goldiam has made a conscious decision to lean more heavily on lab-grown diamond jewellery, noting that it sells faster and offers better capital efficiency compared to natural diamonds. In the US market, the company is focusing on increasing 'dollars per store' by upselling customers to larger caratage (5-10 carat diamonds, up from 1-5 carat) and introducing high-end fashion and bridal collections. This strategy aims to double the company's overall business and export revenue within the next four years, with export market growth directionally at 10-15%.

Commitment to Transparency and Governance

Management emphasized Goldiam's commitment to transparency and governance, highlighting that all export operations are from SEEPZ (SEZ) and do not involve loose diamond circulation, a common concern in the broader diamond industry. They stated that Goldiam is a pure design-based jewellery company with no debt, and its track record of cash generation, dividends, and buybacks demonstrates a focus on shareholder value and clear operations.

This is an AI-generated summary of a publicly available earnings call transcript.
View original transcript

More Consumer Durables earnings calls