P N Gadgil Jewellers Limited — Q3 FY26 earnings call

Call held 10 Feb 2026

Management summary

P N Gadgil Jewellers reported a strong Q3 FY26, with consolidated revenue growing 35.6% YoY to INR 3,302 crores and net profit surging 98.6% to INR 170.9 crores. This performance was driven by the discontinuation of the zero-margin refinery business, a 52% increase in studded jewellery mix, and the introduction of the high-margin LiteStyle segment. The company expanded its store footprint to 66 outlets and aims for 78-80 by March 2026, while navigating a challenging environment of volatile gold prices and increased operating expenses.

Highlights

  • Consolidated Revenue from Operations grew by 35.6% YoY to INR 3,302 crores.

  • Gross Profit rose by 98.2% YoY to INR 474 crores.

  • EBITDA grew by 109.4% to INR 271.7 crores.

  • Net Profit surged 98.6% YoY to INR 170.9 crores, with Net Profit Margin at 5.2%.

  • Studded jewellery mix rose 52% in value, taking stud ratio to 8.4%, contributing to margin expansion.

  • Store count reached 66, with plans to add 11-12 more stores in Q4 FY26, targeting 78-80 by March 2026.

Concerns

  • YoY gold volume growth was single digit or flat, despite overall revenue growth.

  • Other expenses surged from INR 85 crores to INR 190 crores YoY, primarily due to advertising and brand ambassador costs.

Key financials

2 periods

Q3 FY26

  • Revenue from Operations
    ₹3,302 Cr
    YoY +35.6%
  • Gross Profit
    ₹474 Cr
    YoY +98.2%
  • EBITDA
    ₹271.7 Cr
    YoY +109.4%
  • Net Profit
    ₹170.9 Cr
    YoY +98.6%
  • Net Profit Margin
    5.2%
  • Gold Volume Growth
    0.25 decimal_fraction

9M FY26

  • Revenue from Operations
    ₹7,194.8 Cr
  • Gross Profit
    ₹957.9 Cr
    YoY +86.8%
  • Gross Margin
    13.2%
  • EBITDA
    ₹537.7 Cr
    YoY +105.3%
  • EBITDA Margin
    7.5%
  • Net Profit
    ₹319.6 Cr
    YoY +104.5%
  • Net Profit Margin
    4.4%

What they filed

Q1 FY27: revenue up 40.7%, net profit up 52.2% against the same quarter last year.

₹ Cr · quarterly
Line itemQ2 FY25Q3 FY25Q4 FY25Q1 FY26Q2 FY26Q3 FY26Q4 FY26Q1 FY27
Revenue2,001 2,436 1,588 1,715 2,178 +9%3,303 +36%3,544 +123%2,413 +41%
EBITDA54 123 94 110 107 +98%244 +98%135 +44%182 +65%
Net profit35 86 62 69 79 +126%171 +99%90 +45%105 +52%
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
₹6,766.6 Cr Total
  • Retail Segment ₹5,524.4 Cr 81.6%
  • Franchisee Segment ₹864.8 Cr 12.8%
  • E-Commerce Segment ₹377.4 Cr 5.6%

Capital allocation

high confidence
  • Capex Capex disclosed PNG stores funded from internal accruals
    • Store fit-outs for PNG stores ₹2 Cr
    • Store fit-outs for LiteStyle stores ₹70 lakh
    • Inventory for PNG stores ₹55 Cr
    • Inventory for LiteStyle stores ₹8 Cr
    Saurabh Gadgil: Capex for our PNG stores is around INR2 Crores in terms of the store fit-outs and around INR70 lakhs for the Litestyle stores. The franchise stores, the capex is borne by the franchisee, so that is not a cost for the company. And inventory wise, like I mentioned before, we need around INR 55 crores of inventory-gold, diamond, silver put together for the company stores and for Litestyle should be in the range of around INR 8 to INR 10 crores. ... The stores of PNG would be completely funded from its internal accruals.
  • Liquidity Liquidity disclosed QIP plans are being evaluated to fund future expansion, with Board approval valid until August 2026.
    Saurabh Gadgil: So like I mentioned before, we have not yet freeze on any timelines for the QIP. The resolution is in effective till August of 2026. So, we're still working on that and once we confirm, we'll be able to communicate with you.

Guidance & targets

Revenue

  • Consolidated Revenue from Operations Revenue · FY26 · High confidence close to INR 10,000 Crores

    Previously INR 9,000-9,500 crores → close to INR 10,000 Crores

    So hopefully we should cross the INR9,500 and be close to be INR10,000 Crores is what we are projecting.

    — Saurabh Gadgil

  • Consolidated Revenue from Operations Revenue · FY27 · High confidence INR 12,000 crores
    But I think next year we should be able to have a 20% to 25% growth over this year. So around INR 12,000 crores is what we should be able to target for FY ‘27.

    — Saurabh Gadgil

Store Count

  • Total Store Count Store Count · by March 2026 · High confidence 78-80 stores
    Looking ahead, we plan to add approximately 11-12 new stores, comprising a mix of COCO company-owned and FOCO franchisee-owned stores across Maharashtra and Central India region, enabling us to reach our target of 78-80 stores by March 2026.

    — Saurabh Gadgil

  • Total Store Count Store Count · by March 2027 · High confidence 105 stores
    So, FY March '26 we should be nearing around 80 stores and I think FY '27 we would be adding, depending on the QIP we do it, but at a comfortable pace we can look at around adding 25 more stores. ... 105 stores at the end of March 2027.

    — Saurabh Gadgil

Profitability

  • Annualized EBITDA Margin Profitability · long run · High confidence 7%-7.25%
    On an annualized basis, we had projected that we would see a increase in margins, EBITDA margins, and that should be sustainable at 7% to 7.25% is what we feel.

    — Saurabh Gadgil

  • Annualized PAT Margin Profitability · long run · High confidence 3.75%-4%
    A PAT margin is around 3.75% to 4% is what we feel is sustainable in the long run.

    — Saurabh Gadgil

  • Sustainable Gross Margin Profitability · going forward · High confidence 13%-14%
    So we have always mentioned that around 13% to 14% gross margins is something which should be sustainable.

    — Saurabh Gadgil

  • Sustainable Retail EBITDA Margin Profitability · going forward · High confidence 8%-8.25%
    See, retail EBITDA we should be in the range sustainable should be around 8% to 8.25%.

    — Saurabh Gadgil

  • Sustainable Retail PAT Margin Profitability · going forward · High confidence 5.5%
    So retail, I think PAT in the range of 5.5% should be sustainable.

    — Saurabh Gadgil

Product Mix

  • Stud Ratio Product Mix · next three to four years · High confidence 13%-14%

    From 8.4% (Q3 FY26) today

    the company focus would still be to take this stud ratio to 13% to 14%.

    — Saurabh Gadgil

  • LiteStyle Sales Contribution Product Mix · going forward · Medium confidence 10%

    From 5%-6% today

    So see, we would definitely aim to increase that business because that's a business which is lightweight, it's impulse buying, and it's connecting to the next generation. So, we'll be happy if we can reach a target of 10% with Litestyle.

    — Saurabh Gadgil

Operating Expenses

  • Marketing Expenses as % of Total Turnover Operating Expenses · going forward · High confidence 1.5%
    But having said that, we'll still be able to stick to the 1.5% level of marketing expenses of total turnover as we had given the guidance in the last call.

    — Saurabh Gadgil

What to watch in Q4 FY26

FY26 Revenue Achievement

Q4 FY26
Current INR 7,194.8 crores (9M FY26)
Target Close to INR 10,000 crores (for FY26)

Why it matters

Verifies management's upgraded revenue guidance for the current fiscal year.

So hopefully we should cross the INR9,500 and be close to be INR10,000 Crores is what we are projecting.

Risks & concerns

  • Volume Degrowth in Industry

    medium

    The entire industry, including PNGJL, experienced volume degrowth due to high gold prices, though margins are maintained through making charges.

    Management acknowledged

  • Surge in Other Expenses

    medium

    Other expenses increased significantly YoY due to higher advertising and brand ambassador costs for expansion, but management aims to maintain marketing expenses at 1.5% of total turnover.

    Management acknowledged

  • Uncertainty in QIP Finalization

    low

    QIP plans are not yet finalized, with the Board resolution effective until August 2026, creating some uncertainty regarding future funding.

    Management acknowledged

Q&A highlights

6 direct
Gross Margin Drivers Direct
Primarily the first reason was that we had stopped the sale of the zero margin refinery business. Now that was definitely the key factor which would have an impact on margins. Having said that, another focus area for us which was the studded jewellery mix that has shown a considerable increase. We have increased by 52% in value and that has been another contributor to the margin rise. And thirdly our foray into the LiteStyle jewellery segment by LS by PNG which is more of a diamond and studded jewellery category is also yielding good results.

Explains the significant jump in gross margins, attributing it to strategic business changes and product mix shift rather than gold price fluctuations.

Asked by Pulkit

LiteStyle Strategy & Contribution Direct
This is a very seriously planned discussed with the management. On one side we are looking at higher gold prices, other side we are looking at a lot of new generation customers who want jewellery not on a occasion but for their own occasion. So we have always mentioned that PNG is a—the demand driver is primarily festive and wedding, while Litestyle will be more towards own occasions, personal birthdays, anniversaries, gifting.

Clarifies the strategic rationale behind the LiteStyle expansion, targeting a different customer segment and occasion, and its role in future growth.

Asked by Aman

Revenue Growth vs. Peers Partial
I think I can't comment on what the other players are doing. We are sticking to our guidance, we are sticking to what projections we had made. And I think the store growth and volume growth is not just coming just from existing stores; it's also new store addition, there's a lot of various factors.

Highlights management's focus on internal targets and strategy, rather than direct comparison with competitors, suggesting confidence in their own growth trajectory.

Asked by Shubham Shukla

Volume Growth & Gold Prices Direct
the whole industry has seen volume degrowth. What the industry is focusing on, are the margins being able to maintain. And the margins, as you know, comes from making charges. So as long as your making charge income is intact, the margins would not be affected.

Addresses concerns about volume degrowth in a high gold price environment and explains how the company maintains margins through making charges, which are independent of gold price fluctuations.

Asked by Rajiv Bharati

QIP Plans Partial
So like I mentioned before, we have not yet freeze on any timelines for the QIP. The resolution is in effective till August of 2026. So, we're still working on that and once we confirm, we'll be able to communicate with you.

Indicates that the QIP is still in the planning and evaluation phase, with no immediate timeline or finalized details, which is important for understanding future funding and potential equity dilution.

Asked by Anukool

Store Expansion & Revenue Correlation Direct
So see, when you say 25 stores, I'm talking of the PNG store and the Litestyle stores. The Litestyle stores are smaller compared to PNG. So a PNG store typically would have a inventory of around INR 55-INR 60 crores. A Litestyle should be in the range of around INR 10 crores. So when you try to look at the entire number, 25 stores would only mean around 12 to 13 or 14 PNG stores and the balance Litestyle stores. That is why on a gross level the revenue increase would be at least 20%.

Provides a detailed breakdown of the planned store mix (PNG vs. LiteStyle) and their respective inventory requirements, clarifying how the 25 new stores translate to the 20% revenue growth guidance.

Asked by Nitin Jain

Retail Segment Margin Sustainability Direct
See, retail EBITDA we should be in the range sustainable should be around 8% to 8.25%. At a company level, we're talking of 7%. So I think this is what we feel is sustainable. Retail will benefit from the higher focus of studded, from the higher focus of lightweight jewellery, and as our merchandising also is moving more towards lightweight, would also mean higher margins for the side of business.

Offers specific sustainable margin targets for the retail segment, outlining the strategic initiatives (LiteStyle, studded jewellery, lightweight merchandising) expected to drive this profitability.

Asked by Tushar Verma

Other Expenses Surge Direct
See, the other expenses, primarily the increase has been in the advertising expenses, because the number of stores have increased from 47 to 65. Expansion in newer states from Madhya Pradesh, Uttar Pradesh, Bihar. Signing up of Ranbir Kapoor and Sara Tendulkar as brand ambassadors has been the primary driver.

Explains the significant increase in operating costs, linking it directly to strategic expansion and brand-building efforts, providing context for the expense growth.

Asked by Rajiv Bharati

3 min read 7 chapters

Detailed narrative

Strong Q3 FY26 Financial Performance

P N Gadgil Jewellers delivered robust Q3 FY26 results, with Consolidated Revenue from Operations growing 35.6% year-on-year to INR 3,302 crores. Gross Profit surged 98.2% YoY to INR 474 crores, while EBITDA increased by 109.4% to INR 271.7 crores. Net Profit saw a significant jump of 98.6% YoY, reaching INR 170.9 crores, with the Net Profit Margin standing at 5.2%. For the nine months ended FY26, revenue stood at INR 7,194.8 crores, with a Net Profit Margin of 4.4%.

Key Drivers of Margin Expansion

The substantial improvement in gross and net margins was primarily driven by three factors: the discontinuation of the zero-margin refinery business, a 52% increase in the value of studded jewellery mix, and the successful foray into the high-margin LiteStyle jewellery segment. Management clarified that the company is fully hedged against gold price movements, ensuring margins are not impacted by price volatility. The LiteStyle segment currently contributes 5-6% to overall sales and is targeted to reach 10%.

Strategic Store Expansion & Footprint Growth

The company expanded its physical presence by launching three new company-owned stores during the quarter, bringing the total store count to 66. P N Gadgil Jewellers now operates across five states: Maharashtra, Goa, Madhya Pradesh, Bihar, and Uttar Pradesh. For the current quarter (Q4 FY26), the company plans to add 11-12 new stores, targeting a total of 78-80 stores by March 2026. A further 25 stores are planned for FY27, comprising a mix of PNG and LiteStyle formats, aiming for 105 stores by March 2027.

E-commerce and Franchisee Segment Growth

The E-Commerce segment demonstrated strong growth, with revenue increasing by 125.8% YoY to INR 377.4 crores, while the Franchisee segment also saw a significant rise of 65.4% YoY, contributing INR 864.8 crores. Management clarified that e-commerce, including bullion sales, is a net margin business with 1.5-2% margins on bullion, and is not margin-dilutive. E-commerce is also viewed as an omni-channel tool, allowing customers to browse online and buy offline.

Operating Expenses & Marketing Spend

Other expenses witnessed a notable increase, surging from INR 85 crores to INR 190 crores YoY. This was primarily attributed to higher advertising and brand ambassador costs, including the appointment of Ranbir Kapoor and Sara Tendulkar, to support expansion into new states like Madhya Pradesh, Uttar Pradesh, and Bihar. Despite the increase, management reiterated its commitment to maintaining marketing expenses at 1.5% of total turnover, aligning with previous guidance.

Studded Jewellery Focus & Future Targets

The company's focus on studded jewellery led to a 52% increase in its value contribution, with the stud ratio reaching 8.4% (or approximately 10% including Polki and Kundan). Management aims to further increase this ratio to 13-14% over the next three to four years, leveraging the higher demand for studded jewellery in newer markets like Central and North India. The LiteStyle segment, designed for younger, fashion-conscious consumers, is targeted to reach 10% of overall sales, complementing the traditional festive/wedding focus of PNG.

QIP Plans & Funding

The Qualified Institutional Placement (QIP) plans are still under discussion, with the Board's approval valid until August 2026. The primary purpose of the QIP is to fund future expansion initiatives. Management stated that they are evaluating geopolitical developments and will communicate further details once conclusions are reached. The expansion of PNG stores is expected to be funded through internal accruals, indicating a cautious and well-thought-out funding strategy.

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