Kalyan Jewellers India Limited has delivered impressive financial results for the first quarter of fiscal year 2026, demonstrating remarkable resilience in India’s competitive jewelry retail sector. The Kerala-based jewelry giant reported a substantial 48% year-on-year increase in consolidated net profit, reaching ₹264 crore compared to ₹178 crore in the corresponding quarter of the previous year. 

This strong performance comes at a time when the jewelry industry faces ongoing challenges from gold price volatility and evolving consumer preferences.

The company’s revenue trajectory showcased robust growth momentum, with total revenue from operations climbing 31% year-on-year to ₹7,268 crore in Q1 FY26, significantly higher than the ₹5,528 crore recorded in Q1 FY25. This substantial revenue expansion reflects Kalyan Jewellers’ successful market penetration strategy and growing consumer confidence in the brand across multiple geographical markets.

Operational Excellence Drives Profitability Metrics

Kalyan Jewellers’ operational efficiency became evident through its EBITDA performance, which surged 38% to ₹508 crore from ₹368 crore in the previous year’s corresponding quarter. 

The EBITDA margin remained relatively stable at 7% compared to 6.6% year-on-year, indicating the company’s ability to maintain profitability ratios while scaling operations significantly. This stability in margins demonstrates effective cost management despite inflationary pressures affecting the retail sector.

The jewelry retailer attributed its strong same-store sales growth (SSSG) as a key driver behind the robust revenue performance across various markets and product categories. However, the company noted that a higher proportion of revenue from franchised showrooms, approximately 43% during the quarter, contributed to slightly lower overall gross margins and EBITDA margins compared to company-owned stores.

International Operations and Diversification Strategy

Kalyan Jewellers’ international expansion strategy continued to yield positive results, with overseas operations recording revenue of ₹1,070 crore during the reporting quarter, marking a 32% growth compared to the same period in the previous financial year. The Middle East operations specifically generated ₹1,026 crore in revenue with a profit after tax (PAT) of ₹22 crore, representing growth rates of 27% and 18%, respectively.

The company’s diversification into lifestyle jewelry through its Candere platform generated ₹66 crore in revenue during Q1 FY26, though it recorded a net loss of ₹10 crore. This investment in the digital and lifestyle segment represents Kalyan Jewellers’ strategic focus on capturing younger demographics and emerging market segments in India’s evolving jewelry consumption patterns.

Strategic Initiatives and Future Growth Plans

Ramesh Kalyanaraman, Executive Director of Kalyan Jewellers India Limited, expressed confidence in the company’s trajectory despite ongoing market challenges. “We have started off the ongoing quarter well despite continuing volatility in gold prices and a higher base. We are upbeat about the upcoming festive season across the country and are gearing up for the launch of fresh collections and campaigns,” he stated.

The company’s expansion strategy remains aggressive, with plans to launch 84 Franchise Owned Company Operated (FOCO) Kalyan showrooms across India during FY26. During the first quarter alone, the company added 10 new showrooms in India, maintaining healthy new customer acquisition rates. This expansion approach through the FOCO model allows Kalyan Jewellers to maintain quality control while reducing capital expenditure requirements for geographical expansion.

Innovative Operational Improvements

Management highlighted several strategic initiatives designed to enhance profitability and operational efficiency. The company is implementing a pilot project focusing on “lean credit procurement” aimed at driving higher margins and improving Return on Capital Employed (RoCE). If this initiative proves successful and is implemented company-wide, it would require a significant capital infusion of ₹1,500-2,000 crore, indicating the scale of operational transformation being contemplated.

Additionally, Kalyan Jewellers is rolling out a new strategy involving regional brands, with plans to open five stores in a single state over the next twelve months under the FOCO model. This regional approach allows for better market penetration and localized customer engagement while maintaining the brand’s core identity and quality standards.

Market Performance and Analyst Outlook

Despite the strong financial performance, Kalyan Jewellers’ stock experienced volatility in the market. Shares opened higher at ₹615.65 on August 8, 2025, but declined to hit the day’s low of ₹542, reflecting broader market uncertainties and profit-booking by investors. The stock closed at ₹598.10 on August 7, gaining 1.34%, but fell approximately 9% the following day.

Global brokerage firm Citi maintained its ‘Buy’ rating on Kalyan Jewellers while raising the price target to ₹700, indicating continued confidence in the company’s long-term growth prospects. The brokerage noted that EBITDA and profit before tax (PBT) performance exceeded their estimates by 9% and 14% respectively, driven by better operating leverage and strategic initiatives.

Among analyst coverage, eight out of nine analysts maintain ‘Buy’ ratings on the stock, with only one ‘Sell’ recommendation, suggesting predominantly positive sentiment within the investment community regarding Kalyan Jewellers’ future prospects.

Strategic Financial Management

The company has announced a pause in further debt reduction initiatives, choosing instead to focus on realizing and monetizing real estate collateral with banks. This strategic shift indicates management’s confidence in maintaining healthy cash flows while optimizing capital allocation for growth opportunities rather than aggressive deleveraging.

Kalyan Jewellers’ performance in Q1 FY26 demonstrates the company’s ability to navigate challenging market conditions while maintaining growth momentum. The combination of strong same-store sales growth, successful international operations, strategic expansion plans, and operational efficiency improvements positions the company well for the upcoming festive season, traditionally the strongest period for jewellery retailers in India.

As the company prepares for new collection launches and marketing campaigns, its diversified approach across traditional and lifestyle segments, coupled with aggressive but calculated expansion strategies, suggests continued potential for market share gains in India’s evolving jewellery retail landscape.