Shanti Gold International Limited — Q3 FY26 earnings call

Call held 11 Feb 2026

Management summary

Shanti Gold International Limited reported robust Q3 FY26 performance with significant revenue and profit growth, driven by strong volume expansion and increased transactions with organized retailers. The company's credit rating was upgraded, reflecting improved financial health. However, margins saw a sequential dip attributed to gold hedging and a new lower-margin product line. Management outlined plans for capacity expansion, new product categories, and increased export focus, aiming for sustained high growth.

Highlights

  • Revenue from operations for Q3 FY26 stood at INR636.9 crores, registering a strong growth of 110.06% YoY.

  • EBITDA for Q3 FY26 was INR60.18 crores, a growth of 113.83% YoY, with margins improving by 17 bps to 9.45%.

  • PAT for Q3 FY26 was INR40.08 crores, with PAT margins at 6.29%.

  • Volume grew by 31% YoY to 535 kilograms in Q3 FY26, driven by healthy demand and improved manufacturing operations.

  • Credit rating upgraded by CARE Rating from BBB+ to A-minus stable for long-term bank facility, reflecting improved operating performance and strengthened balance sheet.

Concerns

  • Margins declined sequentially due to gold hedging activities and the introduction of a new plain gold jewellery line with higher churning and lesser margins.

  • Gold price volatility remains a factor influencing customer behavior and volumes, though management plans to hedge gold in the future to mitigate this risk.

Key financials

2 periods

Q3 FY26

  • Revenue
    ₹636.9 Cr
    YoY +110.1%
  • EBITDA
    ₹60.18 Cr
    YoY +113.8%
  • EBITDA Margin
    9.4%
  • PAT
    ₹40.08 Cr
  • PAT Margin
    6.3%
  • Volume
    535 kilograms
    YoY +31%

9M FY26

  • Revenue
    ₹1,359.78 Cr
    YoY +68.1%
  • EBITDA
    ₹159.21 Cr
    YoY +162.8%
  • EBITDA Margin
    11.7%
  • PAT
    ₹108.64 Cr
    YoY +200%
  • PAT Margin
    8%
  • Volume
    1,285 kg
    YoY +12%

What they filed

Q1 FY27: revenue up 144.4%, net profit up 100.0% against the same quarter last year.

₹ Cr · quarterly
Line itemQ2 FY25Q3 FY25Q4 FY25Q1 FY26Q2 FY26Q3 FY26Q4 FY26Q1 FY27
Revenue266 303 297 293 430 +62%637 +110%659 +122%716 +144%
EBITDA17 28 21 38 61 +259%60 +114%67 +219%71 +87%
Net profit9 18 9 25 44 +389%40 +122%52 +478%50 +100%
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.

Capital allocation

high confidence
  • Capex ₹55.3 Cr
    • Plant and machinery ₹7 Cr
    • Mumbai facility ₹8.5 Cr
    • Jaipur facility ₹46.8 Cr
    So we have put it in our INR7 crores to INR8 crores we are using it for, like, plant and machinery. (Pankaj Jagawat, page 8); Mumbai we are spending INR8.5 crores as a capex. And Jaipur it's around INR46.8 crores, INR46 crores approximately we're spending. (Pankaj Jagawat, page 11)
  • Debt Net ₹225 Cr · 0.3× EBITDA
    Currently our debt level is at 0.3%, which is way much less than the normal standard debt-equity ratio. So on the debt level, we have got an enough adequate headroom to go for debt also to back the growth of the company. So as of now, my debt stands at INR225 crores, not INR300 crores. And at debt-equity stands at 0.3%.

Guidance & targets

Volume

  • FY27 Volume Growth Volume · FY27 · High confidence 60% to 70%
    From our this year, if we complete 60% to 70% again, we are expecting the growth.

    — Pankajkumar Jagawat

Export Revenue

  • Export Revenue Share Export Revenue · next year · High confidence 10%

    From 2% today

    And our exports should go up from 2% to 10%.

    — Pankaj Jagawat

Margin

  • Gross Margins Margin · going forward · Medium confidence 8% to 10%

    From 7% to 8% today

    Going forward, it would be around 8% to 10%.

    — Pankaj Jagawat

  • Sustainable PAT Margin Margin · sustainable · High confidence 4%
    4% would be sustainable, which we are going to achieve with the kind of jewellery what we are manufacturing and the designing and all. So 4% is very sustainable, net profit, PAT.

    — Pankaj Jagawat

Revenue

  • FY26 Revenue Revenue · FY26 · High confidence INR2,000 crores
    this fiscal I believe we'll clock somewhere around INR2,000 crores if I'm not mistaken? Yes.

    — Pankaj Jagawat

Capacity

  • New Factory Commissioning (Mumbai/Marol) Capacity · May 2026 · High confidence Operational by May 2026
    So this -- this factory should start by May.

    — Pankaj Jagawat

  • Jaipur Facility Operational Capacity · July 2026 · High confidence Operational by July 2026
    It should be operational by July.

    — Pankaj Jagawat

  • Total Capacity Post-Expansion Capacity · by May 2026 · High confidence 6,700 kgs

    From 2,700 kgs today

    Okay, so you currently have 2,700 kgs, so it will take you to 6,700 kgs in total? Yeah.

    — Pankaj Jagawat

  • Overall Capacity Utilization Capacity · next year · High confidence 75% to 80%

    From 66% to 68% today

    At present it is 66%, 68%. At present it is 66% utilized, so it should reach around 75% to 80%, yeah.

    — Pankaj Jagawat

What to watch in Q4 FY26

New Factory Commissioning (Mumbai/Marol)

May 2026
Current Under construction
Target Operational

Why it matters

Successful commissioning is crucial for achieving the planned capacity expansion and supporting future volume growth.

So this -- this factory should start by May.

Risks & concerns

  • Gold Price Volatility

    medium

    Elevated gold prices impacted customer behavior and moderated volumes in certain segments; management plans to hedge gold in the future to mitigate this risk.

    Management acknowledged

  • Margin Compression from New Product Line

    medium

    Introduction of a new plain gold jewellery line with higher churning and lower margins contributed to a sequential dip in overall margins.

    Management acknowledged

Q&A highlights

8 direct
Margin dip despite high volumes Direct
The margins were declined because we had done some portions of our gold hedging during this quarter. And we started a new line of jewellery which has a higher churning and a lesser margin.

Explains the sequential margin compression, attributing it to strategic hedging and a new product line with different margin profiles.

Asked by Aniket Madhwani

Capacity expansion commissioning and total capacity Direct
So this -- this factory should start by May. ... Okay, so you currently have 2,700 kgs, so it will take you to 6,700 kgs in total? Yeah.

Provides a clear timeline for the new capacity becoming operational and the resulting total manufacturing capacity, indicating future growth potential.

Asked by Aniket Madhwani

Export revenue target and sustainability of margins Direct
And our exports should go up from 2% to 10%. ... Because we have started a new line of jewellery also where there are margins a little low. The bridal, the margins is high. When we join everything, should be around 4%.

Highlights the company's international expansion strategy and clarifies the blended margin expectation considering different product categories.

Asked by Urmish Shah

Distinction between Shanti Gold and Utsav (another listed entity) Direct
When Shanti Gold has started, it has started on a mass production and when Utsav we had started where Karisma Kapoor used to be our brand ambassador and that jewellery we used to sell it on the maximum retail price. So both companies couldn't have it been combined together those time. Because this was a different line and that was a different line.

Clarifies the strategic differentiation between the two listed entities under the same promoters, emphasizing distinct product lines and market approaches.

Asked by Nitin Shah

Debt level post IPO Direct
Currently our debt level is at 0.3%, which is way much less than the normal standard debt-equity ratio. ... So as of now, my debt stands at INR225 crores, not INR300 crores. And at debt-equity stands at 0.3%.

Reassures investors about the company's healthy and manageable debt levels, indicating financial flexibility for future growth.

Asked by Jeyaprakash

Sustainable PAT margin ex-inventory gains Direct
4% would be sustainable, which we are going to achieve with the kind of jewellery what we are manufacturing and the designing and all. So 4% is very sustainable, net profit, PAT.

Provides clarity on the company's long-term sustainable net profit margin, separating it from one-time inventory gains.

Asked by Arup Dey

Gold inventory holding Direct
Ma'am, currently the inventory holding is at 1.5 to 2 months period, which has been average. Yes, because of increase in the prices, the inventory value does goes up. But if you see in terms of the turns, it's at the healthy margin. Maybe going forward with the diverse product line that we are going to plan, the inventory holding will further improve only. So as of now, we are at 60% to 65% -- that's roughly two months average holding period.

Details the company's inventory management, indicating a healthy holding period and potential for improvement with product diversification.

Asked by Nikita Mehta

Consistency of gold hedging policy Direct
We would like to hedge the gold and we would like to make a simple business dealing. Which would be very effective for us with a very low percent of interest and which is going to benefit the company, yeah.

Confirms management's strategic shift towards consistent gold hedging to mitigate price volatility and ensure stable business operations.

Asked by Manish Jaiswal

2 min read 5 chapters

Detailed narrative

Q3 FY26 and 9M FY26 Financial Performance

Shanti Gold International Limited delivered a strong Q3 FY26, with revenue from operations growing by 110.06% YoY to INR636.9 crores. EBITDA increased by 113.83% to INR60.18 crores, and PAT stood at INR40.08 crores, resulting in a PAT margin of 6.29%. For the nine-month period ending December 31, 2025, the company surpassed full-year FY25 revenues, reporting INR1359.78 crores in revenue, a 68.06% YoY growth. 9M FY26 EBITDA grew by 162.84% to INR159.21 crores, with PAT reaching INR108.64 crores, a growth of over 200%.

Strategic Growth Initiatives: Capacity Expansion & New Product Lines

The company is undertaking a significant capacity expansion, adding approximately 4,000 kg per annum, which will bring the total manufacturing capacity to 6,700 kg. This new facility is expected to be operational by May 2026, with an additional Jaipur facility operational by July 2026. Shanti Gold also launched a new line of plain gold jewellery catering to the mass market segment, contributing to incremental volume growth. Furthermore, the company plans to enter the Mangalsutra jewellery category to broaden its product portfolio and participate in a structurally significant segment.

Industry Trends and Market Positioning

Shanti Gold observed a clear shift in end-customers' purchasing behavior towards large organized jewellery retailers, who are increasingly outsourcing manufacturing. The company's strong execution, growing scale, and increased transactions with organized retailers reflect this trend. Factors like mandatory hallmarking, regulatory compliance, and growing consumer preference for trusted brands are accelerating formalization across the industry. The company maintains a strong in-house team of 71 CAD designers, enabling quick response to evolving customer preferences and market trends.

Capital Structure and Credit Rating Upgrade

The company's credit rating was upgraded by CARE Rating from BBB+ to A-minus stable for long-term bank facilities, and to A2 plus for short-term facilities. This upgrade reflects improved operating performance, a strengthened balance sheet, and disciplined working capital management. The CFO confirmed a healthy debt position, with net debt at INR225 crores and a debt-equity ratio of 0.3, providing ample headroom for future growth without significant financial strain.

Outlook and Future Growth Drivers

Management is constructive on the medium to long-term outlook, expecting continued formalization of the jewellery market and expansion of organized retail. They project a 60-70% volume growth for FY27 and aim to increase export revenue from the current 4% to 10% by next year, supported by a new office in UAE. The company targets an overall capacity utilization of 75-80% and a sustainable PAT margin of 4% going forward, driven by operational excellence and scalable growth.

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