Senco Gold's share price hits 52-week low, falls another 8% after weak Q3 earnings

At 10:55 AM, shares of Senco Gold were trading at ₹330.8 apiece, tanking 7.49% on BSE. The shares had touched its 52-week low of ₹304.5 during the intraday trade. The company is trading below its listing price of ₹431.

Senco Gold on Friday reported almost 70% loss in its profit for the October-December quarter for the current fiscal. Its share had declined nearly 20% on Friday after the earnings.

The jewellery chain’s consolidated net profit for the December quarter declined 69.4% to ₹33.4 crore as compared to ₹109.3 crore in the corresponding quarter of the previous fiscal year.

However, its revenue from operations saw a 27.3% rise at ₹2,102.5 crore as compared to ₹1,652.2 crore in Q3FY23.

Senco Gold’s earnings before interest, taxes, depreciation, and amortisation (EBITDA) also declined by 56% year-on-year (YoY) at ₹79.9 crore as against ₹181.1 crore in the same quarter last financial year. EBITDA margin during the reporting stood at 3.8% as against 11% year-on-year.

“High volatility was observed in gold prices during Q3, recording a 22% YoY increase and a 20% increase since April 2024. However, consumer demand for gold remained robust throughout Q3. The reduction in customs duties during Q2 rather acted as a tailwind for Q3 sales, especially during Dhanteras and Diwali,” said Managing Director and CEO Suvankar Sen in a statement.

During the quarter, Senco Gold received a good response to its qualified institutional placement (QIP) and successfully raised ₹459 crore. The company has used these funds to repay short-term debt, support expansion plans, and arrange inventory for existing and new showrooms.

Additionally, Senco has also announced a 1:2 stock split on January 31, 2025, further enhancing shareholder value.

In terms of expansion, their showroom portfolio has grown to 171, including 70 franchisee showrooms. Over the past nine months, Senco has launched 12 new showrooms, 7 of which are company-owned. “Looking ahead, we remain on track to open 8-10 new showrooms in Q4 FY25, including 5-7 franchise outlets, in line with our earlier outlook,” Sen further said.

Commenting on the earnings, Chief Financial Officer Sanjay Banka said, “We remain confident that given the long-term prospect of the Indian gems and jewellery, which is presently $85-90 billion, we will achieve a 7%-8% EBITDA margin on an annualised basis excluding any one-off event. The lower EBITDA and PAT margin in the current quarter emanated due to the custom duty impact, while the adjusted 9-month EBITDA margin was 6.0%. We are likely to achieve a 7%-8% EBITDA margin in Q4 and going forward based on our brand positioning and operating leverage and will try to further improve the sale by innovative offerings and premium pricing.”