Kalyan Jewellers shares witnessed an uptick on Friday, rallying as much as 5% to their day's high of ₹629 on the BSE after Jefferies initiated coverage with a Buy rating and target price of ₹830, forecasting an upside of 39% from current levels. With today's surge, the stock has rallied over 60% in a month, demonstrating strong investor confidence despite earlier disappointing quarterly results. The near-63% rally may have led investors to ask whether the easy money has already been made, but Jefferies doesn't think so, believing the organised jeweller is still in the early stages of benefiting from India's formalisation trend. The stock rose over 5% on Friday, trading at ₹621.50 at 9:32 am, marking a significant recovery from recent lows. On Monday, the stock gained another 2.04% to trade at ₹618.65, placing it among the active movers on the Nifty Midcap 150 index, according to latest market data.
Jefferies has initiated coverage on Kalyan Jewellers with a 'Buy' rating and a price target of ₹830, implying an upside potential of nearly 39% from current levels. The foreign brokerage said the company has built a differentiated growth engine by combining the trust and familiarity of neighbourhood jewellery stores with the scale and efficiencies of an organised retailer. In an initiation note authored by Vivek Maheshwari, Kedar Gattani and Rushabh Bhachawat, Jefferies said Kalyan combines neighbourhood relevance with organised scale, creating a differentiated growth engine that drives share gains. The brokerage estimates Kalyan currently commands around 7% market share in India while operating a network of more than 500 showrooms globally. Jefferies expects this strategy to continue driving market share gains over the coming years, with the company's franchisee-led expansion model supporting capital-efficient growth particularly outside its stronghold in South India.
Kalyan Jewellers delivered robust financial results in the first quarter, with consolidated net profit rising 32% year-on-year to ₹348.7 crore and revenue from operations jumping 45.7% to ₹10,588.9 crore from ₹7,268.5 crore in the year-ago quarter. At the operating front, earnings before interest, tax, depreciation and amortisation (EBITDA) increased 24.5% to ₹632.5 crore from ₹508 crore in the previous year. As reported by Motilal Oswal, the India business achieved 47% YoY revenue growth and registered a robust 28% same-store sales growth (SSSG), with the South region contributing 30% and non-South markets accounting for 27% of this growth. However, profits actually slipped compared to last quarter, with margins taking a hit due to fewer sales of high-margin studded jewelry both in India and the Middle East. The company's Q2 consolidated revenue stood at ₹10,588.93 crore with net profit of ₹348.67 crore, compared to Q1's revenue of ₹10,274.94 crore and net profit of ₹409.50 crore.
The company's financial position has strengthened significantly, with Jefferies noting that Kalyan now has a net cash balance sheet, supported by rising free cash flow generation and healthy return ratios. The brokerage expects the company to maintain a net cash balance sheet, aided by rising free cash flow, franchise-led expansion and monetisation of non-core assets. Jefferies projects revenue and earnings to grow at a CAGR of 21-23% between FY26 and FY29, driven by continued expansion in non-South alongside steady growth in the South. For the year ending March 2026, consolidated revenue reached ₹35,742.86 crore, up from ₹25,045.07 crore in FY25, while net profit surged to ₹1,350.40 crore from ₹714.17 crore in the previous year. The company's Earnings Per Share (EPS) improved to ₹13.08 in FY26 from ₹6.93 in FY25, with Return on Equity (ROE) strengthening to 21.40% from 14.88% and Debt to Equity ratio significantly decreasing to 0.08 from 0.69. The company said it will continue to focus on a capital-efficient franchise-led expansion strategy to further improve return on capital employed from the current level of around 30.3%.
The company has announced a final dividend of ₹2.50 per share (25%) for the year ending March 2026, representing a significant increase from the previous final dividend of ₹1.50 per share (15%) in 2025. This follows previous final dividends of ₹1.20 per share (12%) in 2024 and ₹0.50 per share (5%) in 2023. The stock's current momentum is supported by a 'Very Bullish' sentiment as of August 10, 2026, according to Moneycontrol analysis. The company has also recently unveiled a new regional brand, with plans to expand into more identified states to strengthen local connect and compete more effectively with regional players. The company's hyper-local strategy continues to drive growth, with initiatives such as the 'My Kalyan' network having strengthened customer acquisition, while wedding-focused offerings under the Muhurat brand position the company well in India's largest jewellery consumption segment.
