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Kalyan Jewellers Ltd (KJL), established in 1993, is a pan-India jewellery company engaged in designing, manufacturing and selling a wide range of gold, studded and other jewellery products. KJL has 107 showrooms located across 21 states and union territories in India and also an international presence with 30 showrooms across 8 cities located in the Middle East, as on December 31, 2020. KJL has undertaken pioneering initiatives in the Indian jewellery retail industry by introducing measures aimed at transparency and building customer trust in the purity and quality of products and the buying markets.

Our optimism stems from the following:

* Total revenue is expected to grow at a CAGR of 4.4% over FY20-23 to Rs.11,488 cr. EBITDA over the same period is expected to grow at 3.5% CAGR to Rs.843 cr with a margin deterioration of 19bps to 7.3% in FY23. Store expansion in the next 3-4 years will increase opex and put pressure on operating profitability. The PAT is expected to grow at 6.6% CAGR to Rs.173 cr with a margin expansion of 9bps to 1.5% over FY20-23. Adoption of lower tax rate of 25.17% under the new corporate tax regime will improve bottom-line. RoE & RoCE in FY23 is forecasted to be 5.5% (-103bps) and 5.9% (-79bps) respectively.

* KJL operates as a hyperlocal jewellery company. It endeavors to cater to its customers’ unique preferences, which often vary significantly by geography and micro market, through its local market expertise and region-specific marketing strategy and advertising campaigns.

* The company is among the trusted jewellers and has endeavored to establish a strong brand that its customers associate with trust and transparency.

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