Senco Gold grows Q2 revenue 31% despite high gold prices.

Senco Gold Limited (SENCO) reported 31% year-on-year growth in total revenue in Q2 FY27. Retail revenue grew 29%, while same-store sales growth was 19%. The 19% same-store growth is the number I find more useful than the headline revenue growth. Gold prices were about 28% higher year on year during the quarter. When the price of the underlying product rises this much, revenue can grow even without the same increase in jewellery volumes. So I would not read the 31% revenue growth as 31% underlying volume growth. There is another number I am watching. Senco opened six showrooms in Q2, taking its total network to 215 stores. It plans another 10 to 12 stores in H2 FY27. My view is positive on the demand trend, but I want to see how much of the growth survives once gold prices stabilise. High gold prices can also increase working-capital requirements and make jewellery less affordable. The company itself has flagged affordability and working-capital pressure as risks. It is also focusing on inventory turns and reducing inventory days. The next trigger is the Q2 FY27 results. I will watch gross margin, inventory days and profit growth against the 31% revenue growth. My stance: The business update is strong, but I would judge the quarter on profit and cash conversion, not revenue growth alone.