Shares of Kalyan Jewellers India have been under pressure, marking an eight-day losing streak with a total decline of 34%. On Wednesday, the stock dropped by 9% to ₹522 during intraday trading on the NSE. The company’s stock had previously reached an all-time high of ₹795 on January 2, 2025.
Stock Performance and Historical Trends
Over the past two years, Kalyan Jewellers’ market value has seen a remarkable rise, more than doubling during this period. The stock surged over 115% in 2024 and an impressive 180% in 2023. Comparatively, the BSE Sensex rose 20% in 2023 and 9% in 2024.
Since its listing on March 26, 2021, at an issue price of ₹87 per share, Kalyan Jewellers’ stock has skyrocketed 815%, reaching a record low of ₹55 on May 11, 2022, before its massive rally.
Changing Shareholding Patterns
As per December 2024 quarter data, foreign portfolio investors (FPIs) reduced their stake in the company to 15.75%, down from 16.37% in the September quarter. Meanwhile, resident individual shareholders increased their holdings from 6.08% to 6.47%, according to exchange filings.
Business Overview
Headquartered in Thrissur, Kerala, Kalyan Jewellers is among India’s largest jewellery retailers, with a growing presence in the Middle East. The company operates 303 showrooms, spanning over 836,000 sq. ft., offering a range of traditional and modern jewellery in gold, diamonds, and precious stones.
Financial Highlights
In the first half of FY2024-25, Kalyan Jewellers reported a 32% year-on-year increase in consolidated operating income, following 30% and 32% growth in FY2023 and FY2024, respectively. This growth has been driven by strong same-store sales, a shift from unorganised to organised trade, better price realisations, higher sales of studded jewellery, and expansion in non-South Indian markets through franchisees.
However, the company faced challenges with its operating margin dropping to 6.1% in H1FY25, compared to 7.2% in H1FY24. The decline was partly due to a one-time loss of ₹69 crore in Q2FY25 after a 9% reduction in customs duty on gold imports. A similar loss of ₹50-60 crore is expected in Q3FY25. The full-year impact of the customs duty cut is estimated to reduce margins by 50 basis points. Despite this, Kalyan hedges its gold inventory to mitigate price volatility.
Industry Challenges
The jewellery retail industry in India is highly fragmented, with fierce competition from both organised and unorganised players. Regulatory challenges such as restrictions on bullion imports, mandatory PAN disclosures for high-value transactions, GST, and other measures have previously impacted the sector. The seasonal nature of jewellery demand, influenced by festivals, harvests, and auspicious occasions, further adds to revenue volatility.
Despite these challenges, Kalyan Jewellers remains a prominent player, leveraging its strong brand and diverse product offerings to navigate market dynamics.
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