Posted on February 4, 2025 by Niftynews
Over the last seven trading days, Kalyan Jewellers stock has gained an impressive 35%, recovering strongly from a sharp 45% drop from its recent peak of ₹795. This marks the biggest one-day gain for the stock in the past 19 months, following a notable 14% increase on January 31, just ahead of the Union Budget.
Shares of Kalyan Jewellers Ltd. experienced a significant 15% surge on February 4, 2025, marking a continued recovery from the sharp lows seen on January 28 when the stock hit ₹420. This surge is a part of a broader positive trend, as the stock has gained in three out of the past four trading sessions, signaling a steady rebound from its recent struggles.
This recent surge showcases a positive shift in the company’s market sentiment, as the stock continues its recovery from a significant downturn in January.
Kalyan Jewellers Stock: Performance and Investor Sentiment
As of the latest trading session, Kalyan Jewellers’ stock price is above ₹535, a notable level considering its previous low. This level also coincides with the price at which TS Kalyanaraman, the company’s promoter, acquired a 2.36% stake from Warburg Pincus for nearly ₹1,300 crore in August 2024. The current trading level represents a strong market recovery since that acquisition.
The surge also highlights increased investor confidence in the stock, with retail investors playing a significant role in the recovery. The number of retail investors in Kalyan Jewellers has risen substantially, reaching 5.6 lakh as of February 2025, compared to 3.64 lakh in December 2023. This sharp increase indicates a growing trust in the company’s future growth potential and reflects the broader market’s positive outlook.
Mutual Fund Holdings and Institutional Investor Confidence
In addition to growing retail investor interest, institutional investors, including mutual funds, have shown strong confidence in Kalyan Jewellers. As of December 2024, mutual funds hold 11.75% of the company’s equity. This includes investments from large mutual funds such as Motilal Oswal Mutual Fund, Sundaram Mutual Fund, and Franklin Mutual Fund, all holding over 1% of the company’s shares. These institutional investors’ stakes reflect Kalyan Jewellers’ growing market presence and its strong financial fundamentals.
Financial Results: Kalyan Jewellers’ Impressive Growth
Kalyan Jewellers has been delivering impressive financial results, reinforcing the stock’s recovery. The company reported a Same-Store Sales Growth (SSSG) of 24% in the December quarter, indicating a strong increase in customer demand and overall sales. This result is a testament to the strength of its business operations and its position in the competitive jewelry market.
Moreover, the company expanded its retail footprint by opening 24 new showrooms during the quarter, further solidifying its presence in the jewelry industry. This expansion is part of Kalyan Jewellers’ strategy to increase its market reach and drive future growth, especially in untapped regions and international markets.
International Expansion: Strong Growth in the Middle East
Kalyan Jewellers’ performance is not just strong in the domestic market but also internationally. The company’s Middle East business reported a 16% increase in Same-Store Sales, reflecting robust growth in one of its key international markets. The growth in the Middle East highlights Kalyan Jewellers’ global expansion strategy and its ability to capture the attention of international customers.
Return on Capital Employed (RoCE) and Shareholder Rewards
Kalyan Jewellers has set ambitious targets for improving its Return on Capital Employed (RoCE), which is a key metric for profitability. The company is focusing on enhancing operational efficiencies and leveraging its resources effectively to maximize shareholder value. With a strong focus on profitability, Kalyan Jewellers plans to reward its shareholders through dividends in the coming quarters, driven by the benefits of its free cash flow and improved financial performance.
Conclusion: A Bright Future for Kalyan Jewellers
The 15% surge in Kalyan Jewellers stock demonstrates the company’s resilience and ability to recover from market setbacks. With robust financial results, an expanding retail footprint, and growing investor interest, Kalyan Jewellers is positioned for long-term success. The company’s strategic focus on improving its RoCE, rewarding shareholders, and continuing to expand in international markets further enhances its growth prospects.
As Kalyan Jewellers continues to strengthen its presence both in India and abroad, the future looks promising for investors. The recent stock surge is just one indicator of the company’s positive trajectory, and there’s strong potential for sustained growth in the coming years.