Company Update : Senco Gold Ltd by Motilal Oswal Financial Services Ltd
Beat on profitability; quarter performance remain volatile
* Senco reported strong consolidated revenue growth of 51% YoY to INR30.7b (est. INR23.9b). The 3Q performance remained volatile; 2QFY26 revenue growth was 2.4% YoY (peers were >20%) and 28% in 1QFY26.
* As per the 3QFY26 business update, retail revenue increased 49% YoY; our preview estimates were prepared before the pre-quarter update.
* Average transaction value (ATV) increased 8% QoQ to INR93,000, while average selling price rose 6% QoQ to INR60,270, reflecting improved realizations.
* Titan (Jewelry standalone, ex-bullion), Kalyan, and P N Gadgil (retail) delivered revenue growth of 40%, 42%, and 36%, respectively, in 3Q.
* Consolidated gross margin expanded sharply by 830bp YoY to 19.9% (vs. est. 14.3%; 17% in 2QFY26), adjusted for the customs duty impact in the base quarter. Gross margins were down by 710bp in 3QFY25.
* Employee expenses rose 31% YoY (adjusted for a one-time INR62m labor code impact), while other expenses increased 63% YoY.
* EBITDA margin expanded 810bp YoY and 640bp QoQ to 13.4% (est. 6.7%, 6.9% in 2QFY26), supported by the sharp improvement in gross margins.
* EBITDA grew 282% YoY to INR4.1b (est. 1.6b).
* APAT grew 396% to INR2,687m (est. INR796m, 2QFY26 INR488m).
* In 9MFY26, net sales/EBITDA/APAT jumped 30%/135%/202%.
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