Kalyan Jewellers India Q3 Results Review - Flywheel In Action; Set To Rise: ICICI Securities

ICICI Securities Report

Kalyan Jewellers India Ltd.'s continues to deliver revenue outperformance (34% YoY growth) compared to peers (23% Titan Company Ltd.) driven by franchisee-driven retail expansion (43% YoY), while same store sales growth performance was decent (at plus 11%YoY; plus 13% in non-south).

Incremental work on the replication of the success of franchise owned company operated model in South (converted first ever company owned company operated store to FOCO), the Middle East and in Candere showrooms is likely to be return on invested capital accretive (to reach 20% in medium term versus 15% current; considering gold metal loan).

New customer acquisition remained healthy at ~38%. Operating profit margins were healthy, partly impacted by higher ad-spends due to shift in festivals to Q3 FY24.

Kalyan Jewellers' debt reduction guidance by March 2024 led by selling of non-core assets and conversion of seven stores to FOCO model is on track. Maintain 'Add'.

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