Kalyan Jewellers hits 10% upper circuit on 64% profit jump

KALYANKJIL India Limited (KALYANKJIL) hit its 10% upper circuit at a 52-week high of ₹672.10 on the NSE on November 11, after reporting a 63.6% year-on-year jump in Q2 FY27 consolidated net profit to ₹427 crore. The results came out on Tuesday, November 10. Revenue grew 31.4% to ₹10,322.6 crore. Same-store sales grew about 20%, even though gold prices rose only in single digits, which points to volume-led growth. Adjusted EBITDA rose 26% to about ₹600 crore, ahead of Motilal Oswal’s ₹580 crore estimate. The international business grew 18%. Management said the festive quarter has started very well, with strong demand during Navratri and Dhanteras. Demand is the standout. Same-store sales growth of 20% shows existing stores are selling more jewellery, not just benefiting from higher gold prices. Motilal Oswal kept its Buy rating after the results. The profit headline is flattered, though. The 64% jump was helped by a lower effective tax rate and a one-time gain from a property sale. Adjusted EBITDA grew 26%, slower than 31% revenue growth, so the adjusted EBITDA margin slipped 20 basis points to 5.8%, and adjusted gross margin fell 80 basis points to 11.9%. Exchange sales, where customers trade in old gold, rose to 42% of sales from 30% in Q1, which can weigh on margins. Investors should watch festive and wedding season sales, gross margins, the share of exchange sales, and store additions. The key question is whether Kalyan can protect margins while growing this fast. Disclosure: I do not hold any position in Kalyan Jewellers India Limited. This post is for informational purposes only and is not investment advice.