Kalyan Jewellers India Limited — Q4 FY25 earnings call

Call held 8 May 2025

Management summary

Kalyan Jewellers reported strong Q4 FY25 results with consolidated revenue up 36% and PAT up 37.22% YoY, driven by robust demand and showroom expansion. The company achieved over ₹25,000 crores in revenue for the full FY25 and significantly reduced debt. While Candere recorded a loss in Q4, it is projected to achieve PAT profitability in FY26, and the company plans aggressive showroom expansion and further debt reduction for FY26.

Highlights

  • Consolidated revenue of ₹6,182 crores, up 36% YoY.

  • Consolidated PAT of ₹188 crores, up 37.22% YoY.

  • Standalone India business revenue grew 38% and PAT grew 41% in Q4 FY25.

  • Candere is expected to be profitable at PAT level during FY26.

  • Robust growth witnessed in Akshaya Tritiya sales and encouraging consumer demand.

Concerns

  • Candere posted a loss of ₹12 crores in Q4 FY25, compared to a loss of ₹70 lakhs in the previous year.

  • Gold loan interest rates increased from 3-3.5% to 5-5.5%.

  • Temporary disruption around Gold Metal Loan (GML) in India over the last three to four months.

Key financials

2 periods

Headline

  • Consolidated Revenue
    ₹6,182 Cr
    YoY +36%
  • Consolidated EBITDA
    ₹399 Cr
    YoY +34.8%
  • Consolidated PAT
    ₹188 Cr
    YoY +37.2%
  • Consolidated PBT Margin
    4.1%

FY25

  • Consolidated Revenue
    ₹25,045 Cr
  • Consolidated PAT
    ₹714 Cr

What they filed

Q1 FY27: revenue up 47.0%, net profit up 25.4% against the same quarter last year.

₹ Cr · quarterly
Line itemQ2 FY25Q3 FY25Q4 FY25Q1 FY26Q2 FY26Q3 FY26Q4 FY26Q1 FY27
Revenue5,227 6,386 5,350 6,142 6,843 +31%9,048 +42%8,994 +68%9,026 +47%
EBITDA263 370 344 434 432 +64%654 +77%604 +76%500 +15%
Net profit120 218 185 256 262 +118%401 +84%366 +98%321 +25%
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

Share of Revenue
₹6,162 Cr Total
  • India ₹5,350 Cr 86.8%
  • Middle East ₹784 Cr 12.7%
  • Candere (Ecommerce) ₹28 Cr 0.5%

Capital allocation

high confidence
  • Capex ₹350 Cr
    • Maintenance capex ₹150 Cr
    • Kalyan owned store capex ₹200 Cr
    • Candere owned store capex ₹80 Cr
    Ramesh Kalyanaraman: "So, next year if you ask capex, should be in the range of INR150 crores because only the maintenance capex will be there because next year plan is to open all stores through the new model. Plus of course, Candere stores will be there which is owned, for which capex will be put by Candere, meaning Kalyan, yes, okay." and "No, yes, INR 200 crores for sure, because INR 200 crores plus for sure, because INR 200 crores will be for Kalyan itself. So, INR 200 crores plus Candere will be the right way to look at it." and "So, if you say INR102 crore, it is INR80 crore capex."
  • Debt Debt disclosed Cost 5.5%
    • Repayment Debt reduction in India during FY25 ₹250 Cr
    Ramesh Kalyanaraman: "The year also saw a reduction in debt in India by around INR250 crores." and "Total net reduction over the last two years stands at around INR520 crores." and "Yes. So, gold loan interest rate has been increased in the range of 2% - 2.5%. It has started coming down from the peak, which was at around 5% oddish. So now it's slowly settling down." and "It was in the range 3% - 3.5% now it's in the range of 5%, sorry 5% - 5.5%."
  • Liquidity Liquidity disclosed Management clarified that high cash balance is due to gold loan revaluation by banks, not excess liquidity.
    Ramesh Kalyanaraman: "Cash balance, what is the okay. I will check the cash balance, but what I saw it's only difference INR60 crores increase in Middel East. That is predominantly because the cash is only sitting in the gold loan. Right? Because we have to pay money."

Guidance & targets

Profitability

  • PBT Margins Profitability · FY26 · High confidence > 5%

    From 5% today

    Ramesh Kalyanaraman: "Yes, 4.1. So, I think we should target for a PBT margins of in excess of 5%."

    — Ramesh Kalyanaraman

  • Candere PAT Level Profitability · FY26 · High confidence Profitable
    Ramesh Kalyanaraman: "We expect Candere to be profitable at PAT level during the current financial year."

    — Ramesh Kalyanaraman

Debt

  • Debt Reduction in India Debt · FY26 · High confidence ₹350-400 crores
    Ramesh Kalyanaraman: "As previously communicated, during the ongoing financial year, we plan to open 170 showrooms across Kalyan and Candere formats and plan to reduce that in India by another INR350 to 400 crores."

    — Ramesh Kalyanaraman

Showroom Expansion

  • Total Showrooms Opened Showroom Expansion · FY26 · High confidence 170
    Ramesh Kalyanaraman: "As previously communicated, during the ongoing financial year, we plan to open 170 showrooms across Kalyan and Candere formats and plan to reduce that in India by another INR350 to 400 crores."

    — Ramesh Kalyanaraman

  • Kalyan Showrooms Opened Showroom Expansion · FY26 · High confidence 90
    Ramesh Kalyanaraman: "Yes, 90 plus 80."

    — Ramesh Kalyanaraman

  • Candere Showrooms Opened Showroom Expansion · FY26 · High confidence 80
    Ramesh Kalyanaraman: "We plan to launch 80 Candere showrooms in India during the current financial year through a mix of FOCO and COCO showrooms."

    — Ramesh Kalyanaraman

Studded Ratio

  • Studded Ratio Studded Ratio · FY26 · Medium confidence 30-32%
    Ramesh Kalyanaraman: "Now. I think it should be in the range -- in the same range, in the in the 30%, 31%, 32% range because the expansion now for the next the running financial year is predominantly in Tier 2, Tier 3 markets outside South India where it will be -- the studded ratio will be lesser than what we enjoy in a metro or a Tier 1. So now don't expect any sharp increase from the current level."

    — Ramesh Kalyanaraman

What to watch in Q1 FY26

PBT Margins

FY26
Current 4.1% (Q4 FY25)
Target > 5%

Why it matters

Indicates improvement in overall profitability and operational efficiency.

Ramesh Kalyanaraman: "Yes, 4.1. So, I think we should target for a PBT margins of in excess of 5%."

Risks & concerns

  • Gold price volatility

    medium

    Continuing volatility in gold prices impacts consumer behavior and GML levels.

    Management acknowledged

  • Temporary disruption around Gold Metal Loan (GML) in India

    medium

    Disruption over the last 3-4 months affected debt reduction plans, though situation is returning to normalcy.

    Management acknowledged

  • Increased gold loan interest rates

    medium

    Gold loan interest rates increased from 3-3.5% to 5-5.5%, impacting cost of debt.

    Management acknowledged

Q&A highlights

7 direct
Consumer behavior and inventory composition amidst gold inflation Direct
Ramesh Kalyanaraman: "So, whenever the gold price increases, the demand per se, what happens, people take a pause, people see where the gold is, the price is going and then they either postpone or prepone the purchase according to the occasion. So, demand per se, there is no issue I told you, Akshaya Tritiya was also strong, footfalls are strong, SSGs are strong even for Akshaya Tritiya.

Management clarified that despite gold price volatility, demand remains strong, and they adapt inventory composition (18-carat vs 22-carat) to market conditions.

Asked by Manoj Menon

Profitability impact of 18-carat vs 22-carat gold jewelry Direct
Ramesh Kalyanaraman: "So our margin is only regarding the making charge. So, we, as a percentage, we will not compromise on our making charge at all. In fact, 18-carat will have a bit more profitability than the 22-carats.

Management indicated that 18-carat gold jewelry offers slightly higher profitability due to making charges, influencing product mix strategy.

Asked by Manoj Menon

Ease of upselling studded jewelry during high gold prices Direct
Ramesh Kalyanaraman: "So, for studded product, the perception of the customer for what he should he or she should buy versus what reality is, will be more closer than the plain gold. So, it makes this easier to convert to studded when the prices will go up.

Management confirmed that high gold prices make it easier to convert customers to studded jewelry, as stones absorb a significant portion of the value, aligning better with customer budgets.

Asked by Manoj Menon

Impact of flat diamond prices on consumer preference amidst gold inflation Partial
Ramesh Kalyanaraman: "So, 65% in a studded product is also gold. So, customer, first the customer happiness comes for satisfaction of wearing the product. Everything comes behind that.

Management downplayed the direct impact of flat diamond prices, emphasizing that gold still forms a significant part of studded jewelry and customer satisfaction is paramount.

Asked by Manoj Menon

Robustness of demand trends beyond seasonal events like Akshaya Tritiya Direct
Ramesh Kalyanaraman: "So the demand has been robust right from the previous quarter. What I told you about the Akshaya Tritiya day, and usually what happens all the offers or the prebook, redemption, etcetera, happens ten days in the Akshaya Tritiya zone. Meaning Akshaya Tritiya minus ten days. Both ends to the new fee, the SSGs have been strong and, there has been good momentum at the store level.

Management confirmed that strong demand momentum extends beyond specific festive days, indicating sustained consumer interest.

Asked by Devanshu Bansal

Gold Metal Loan (GML) interest rate increase and its impact Direct
Ramesh Kalyanaraman: "Yes. So, gold loan interest rate has been increased in the range of 2% - 2.5%. It has started coming down from the peak, which was at around 5% oddish. So now it's slowly settling down." and "It was in the range 3% - 3.5% now it's in the range of 5%, sorry 5% - 5.5%.

Management provided specific figures for the increase in gold loan interest rates, highlighting a significant rise from 3-3.5% to 5-5.5%.

Asked by Devanshu Bansal

High cash balance despite debt reduction efforts Direct
Ramesh Kalyanaraman: "Cash balance, what is the okay. I will check the cash balance, but what I saw it's only difference INR60 crores increase in Middel East. That is predominantly because the cash is only sitting in the gold loan. Right? Because we have to pay money.

Management clarified that the seemingly high cash balance is primarily due to gold loan revaluation by banks, not surplus liquidity, addressing an analyst's concern.

Asked by Pallavi Deshpande

Candere's unit economics, expansion strategy, and studded mix Direct
Ramesh Kalyanaraman: "So Candere on an ideal situation, on a matured store or maybe a closer to maturity store, their stock churn should be in the range of 2%. Margins, you know that it is in the range of 30%, 35%." and "Our primary focus will be metro, Tier 1 and Tier 2 locations." and "At a store level, it is 70% studded.

Management provided detailed insights into Candere's operational metrics, strategic focus for expansion, and product mix, indicating a clear path to profitability.

Asked by Naveen

2 min read 6 chapters

Detailed narrative

Strong Q4 and FY25 Financial Performance

Kalyan Jewellers delivered a robust performance in Q4 FY25, with consolidated revenue growing 36% to ₹6,182 crores and consolidated PAT increasing 37.22% to ₹188 crores. The standalone India business also saw significant growth, with revenue up 38% and PAT up 41%. For the full financial year FY25, the company achieved a revenue in excess of ₹25,000 crores and a PAT of approximately ₹714 crores, demonstrating strong operational execution.

Aggressive Showroom Expansion and Debt Reduction

The company pursued an aggressive expansion strategy in FY25, launching 76 Kalyan showrooms and 60 Candere showrooms in India, along with its first showroom in the U.S. Concurrently, Kalyan Jewellers focused on strengthening its balance sheet by reducing debt in India by ₹250 crores during FY25, contributing to a total net debt reduction of ₹520 crores over the last two years. For FY26, the company targets opening 170 new showrooms (90 Kalyan, 80 Candere) and further reducing debt in India by ₹350-400 crores.

Candere's Strategic Focus and Path to Profitability

Candere, the omnichannel platform, is undergoing strategic revamp with a focus on talent infusion, merchandising, and brand identity. Despite posting a loss of ₹12 crores in Q4 FY25, management expects Candere to achieve profitability at the PAT level during FY26. The expansion plan for Candere includes launching 80 showrooms in FY26 through a mix of FOCO and COCO models, with a nationwide campaign planned to drive growth.

Impact of Gold Price Volatility on Consumer Behavior and Inventory Strategy

Management noted that while gold price volatility (40% increase in six months) can cause consumers to pause, demand remains robust, as evidenced by strong Akshaya Tritiya sales. The company continuously adjusts its inventory composition, including 18-carat and 22-carat jewelry, to align with changing price points and consumer preferences. They observed that upselling studded jewelry becomes easier during high gold prices, as the stone component (40-45%) helps maintain perceived value within customer budgets.

Gold Metal Loan Dynamics and Interest Rate Changes

The company experienced temporary disruptions around Gold Metal Loans (GML) in India, which impacted debt reduction plans. Gold loan interest rates have increased significantly, moving from a range of 3-3.5% to 5-5.5%. Management expects the situation to normalize, allowing for a flat position and reduction in non-GML levels in the near term. GML levels also increased due to banks revaluing loans based on higher gold prices.

PBT Margin Outlook and Studded Ratio Targets

Kalyan Jewellers aims to achieve PBT margins in excess of 5% for FY26, an improvement from the 4.1% recorded in Q4 FY25. This improvement is expected to be supported by debt reduction and operational efficiencies. The target for the studded ratio for FY26 is to maintain it within the 30-32% range, acknowledging that expansion into Tier 2 and Tier 3 markets outside South India might lead to a slightly lower studded mix compared to metro/Tier 1 regions.

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