Kalyan's profit grows 64%, faster than revenue

KALYANKJIL Kalyan Jewellers India Limited (KALYANKJIL) reported Q2 FY27 revenue growth of 31.4% to ₹10,323 crore. Consolidated net profit increased 64% to ₹427 crore. The difference between revenue and profit growth is what caught my attention. Operating profit increased 29.7% to ₹644 crore. Net profit grew much faster, so I would examine the full income statement before assuming this profit growth is entirely recurring. The first half was strong too. Revenue reached ₹20,912 crore, up 38%, while net profit rose 48% to ₹776 crore. The company operates 546 showrooms across India and international markets. Management also reported encouraging demand during Navratri and Dhanteras and expects the wedding season to support business through the ongoing festive quarter. My view: The business is showing strong growth, but jewellery revenue is influenced by gold prices as well as customer volumes. I would not treat 31% revenue growth as equivalent to 31% volume growth. The next numbers I would watch are same store sales growth, operating margins and inventory levels. I also want to see whether profit growth remains strong after the festive season. My stance: Positive on the reported growth and festive demand. But after the sharp share price reaction, I would focus on sustainable earnings rather than extrapolating one strong quarter.