PN Gadgil Jewellers , a prominent Indian jewelry retailer, has reported robust financial results for the first quarter, demonstrating resilience in the face of surging gold prices. The company's performance highlights its strong market position and effective strategies in navigating challenging market conditions.

Strong Financial Performance

PN Gadgil Jewellers delivered impressive quarterly results with consolidated revenue growing 3% year-over-year to Rs 1,715.00 crores. The company achieved significant margin expansion, with gross profit surging 63% and gross margin improving from 8.3% to 13.2%. EBITDA grew by 85.4% to Rs 122.00 crores, while Profit After Tax (PAT) increased by 97% to Rs 69.30 crores, resulting in a PAT margin of 4%.

This strong performance came despite a 35% year-on-year surge in gold prices, showcasing the company's ability to maintain profitability in a volatile market environment.

Key Growth Drivers

Several factors contributed to PN Gadgil Jewellers' robust performance:

1. Studded Jewelry Sales: The company reported a 41.6% increase in studded jewelry sales, which now represents 10% of total retail sales.
2. Strong Festive Sales: Record Akshaya Tritiya sales of Rs 139.50 crores demonstrated the company's ability to capitalize on festive demand.
3. Retail Segment Growth: The retail segment, contributing 70.3% of total sales, saw a 19% year-over-year growth.
4. E-commerce and Franchise Expansion: E-commerce revenue surged 126%, while franchise revenue rose 109%, indicating successful diversification of sales channels.

Customer Engagement and Store Expansion

Despite higher gold prices, customer engagement remained robust:

• Transaction volumes increased by 23%
• Footfall rose by 25%

The company added two new LiteStyle stores during the quarter, bringing the total store count to 55. Management plans to add 20-23 stores over the next three quarters, expanding beyond Maharashtra into Central and North India, starting with Indore, Kanpur, and Lucknow.

Future Outlook

PN Gadgil Jewellers' management expressed confidence in the company's growth trajectory. The planned expansion into new geographical markets, coupled with the success of its LiteStyle brand and strong performance in studded jewelry, positions the company well for continued growth.

The company's ability to maintain strong margins and profitability despite rising gold prices demonstrates its resilience and effective business strategies. As PN Gadgil Jewellers continues to expand its footprint and diversify its product offerings, it appears well-positioned to capitalize on the growing demand for jewelry in India.

Annual General Meeting Highlights

In its recent 12th Annual General Meeting, PN Gadgil Jewellers addressed several key points:

• The company sought shareholder approval to increase its overall borrowing limit.
• Revisions to the remuneration of key executives, including the Managing Director and Whole-time Directors, were proposed.
• The appointment of new Independent Directors and a Secretarial Auditor was put to vote.
• A resolution to approve raising funds through the issuance of equity shares was also presented.

These resolutions indicate the company's focus on strengthening its governance structure and preparing for future growth opportunities.

As PN Gadgil Jewellers continues to navigate the dynamic jewelry market, its strong Q1 performance and strategic initiatives suggest a positive outlook for the company's future growth and market position.

PN Gadgil Jewellers , a prominent player in the Indian jewellery market, has unveiled ambitious growth plans for the fiscal year 2026 (FY26). The company is setting its sights on a substantial revenue target while maintaining a steady profit margin.

Revenue and Profit Targets

The jewellery retailer is aiming for a revenue range of Rs 9,000-9,500 crore in FY26. Notably, PN Gadgil Jewellers expects its franchisee business to play a significant role in achieving this target, projecting it to contribute approximately 12% of the total business and generate Rs 1,000 crore in revenue.

In terms of profitability, PN Gadgil Jewellers is committed to maintaining a 4% Profit After Tax (PAT) margin throughout the year. This target underscores the company's focus on balancing growth with sustainable profitability.

Strategic Focus and Market Trends

Saurabh Vidyadhar Gadgil, Chairman and Managing Director of PN Gadgil Jewellers, shared insights into the company's strategic direction. He emphasized that the company is steering clear of lab-grown diamonds due to a lack of consumer demand. Instead, the focus remains firmly on natural diamonds, aligning with current market preferences.

The company has observed an interesting trend in customer behavior, likely influenced by high gold prices. There has been an increase in customers exchanging old gold for new jewellery, with these transactions now accounting for 40-45% of total transactions. This trend benefits the company through making charges, potentially contributing to its revenue and profit margins.

Expansion and Compliance Plans

To comply with Securities and Exchange Board of India (SEBI) requirements, PN Gadgil Jewellers is planning a Qualified Institutional Placement (QIP). This move aims to reduce promoter holdings from the current 86% to 75%. The funds raised through this placement are primarily earmarked to support the company's expansion plans.

Risk Management and Product Strategy

PN Gadgil Jewellers maintains a prudent approach to risk management, particularly in dealing with gold price volatility. The company implements a 100% hedging strategy to protect against fluctuations in gold prices.

Additionally, the company notes that higher diamond ratios in its product mix help reduce the cost of goods, potentially contributing to improved margins.

Market Performance

Despite the positive outlook and strategic initiatives, PN Gadgil Jewellers' shares closed 1.09% lower at Rs 565.00 in the most recent trading session.

As PN Gadgil Jewellers charts its course for FY26, the company's focus on franchisee growth, natural diamonds, and strategic expansion, coupled with its risk management practices, will be key factors to watch in its journey towards its ambitious revenue and profit targets.