Shares of Kalyan Jewellers surged 4 percent and hit a record high of Rs 683.15 on September 12, following a target price raise by brokerage firm HSBC.
Despite the stock's steep eight times spike in value in the past two years, HSBC continues to hold a bullish outlook for the jewellery maker. The brokerage firm believes the stock is still midway into its value creation journey and forecasts another 19 percent upside potential.
Accordingly, the firm raised its price target for the stock to Rs 810, up from the previous Rs 600, while retaining its 'buy' call on Kalyan Jewellers.
At 11.12 am, shares of Kalyan Jewellers were trading at Rs 675.35 on the NSE, slightly off its record high. Volumes in the counter were also strong as 63 lakh shares already changed hands so far, higher than the one week daily traded average of 50 lakh shares.
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HSBC was also impressed by Kalyan Jewellers' capital light expansion which continues to expand rapidly. The brokerage believes that the jewellery maker's continued exponential growth will prevent any likely multiple de-rating.
It also sees several long-range catalysts working for the company, with industry rival Titan's journey coming as a useful guide.
Kalyan Jewellers is currently trading at an estimated FY26 PE ratio of 56x, about 10 percent lower than Titan, making it an attractive buy compared to other consumer sector plays. The company's promoter Trikkur Sitarama Iyer Kalyanaraman also acquired an additional 2.36 percent stake from global private equity giant Warburg Pincus last month. The stake increase by the promoter further cemented expectations of strong growth for the company.
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