Buy Kalyan Jewellers; target of Rs 800: Motilal Oswal

Motilal Oswal's research report on Kalyan Jewellers

Kalyan Jewellers (KALYANKJ)’s consolidated revenue grew 37% YoY to INR60.7b (in line). The Indian business delivered 39% YoY revenue growth, driven by store additions (added 14 Kalyan India and 12 Candere) and a 23% SSSG (25% in south, 21% in non-south). Festive demand was strong; the company achieved >20% SSSG for a 30-day period leading up to Diwali compared to last year (comparable period). The company’s focus on new customer acquisition (36% share of new customers in 2QFY25) supported growth. Revenue growth in studded (+45%) outpaced gold revenue growth (+38%), leading to an increase in studded share to 30% (28% in 2QFY24). This contrasts with Titan, where the demand pressure was on large solitaires, leading to a decline in the studded share.

Outlook

We model 29%/23%/33% revenue/EBITDA/PAT CAGR during FY24-27E. With industry-leading growth, we expect the expensive valuation to sustain. We reiterate our BUY rating with a TP of INR800 (based on 60x Sep’26 P/E).

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