Senco Gold shares fall over 8% after Q1 results. What squeezed profitability?
While consolidated revenue from operations surged 67% year-on-year (YoY) to Rs 3,056 crore, from Rs 1,826 crore in Q1 FY26, profitability came under pressure. Consolidated Profit After Tax (PAT) declined 3% YoY to Rs 101 crore, from Rs 105 crore in the year-ago period. Margins also weakened, with the PAT margin contracting 240 basis points to 3.3%, from 5.7% a year earlier.
Earnings Before Interest, Taxes, Depreciation, and Amortization (EBITDA) grew 16% YoY to Rs 213 crore, from Rs 184 crore in Q1 FY26. However, the EBITDA margin contracted 310 basis points to 7%, from 10% a year earlier, due to promotional discounting, lower gold prices and changes in customs duty.
Strong operational growth across retail network
Despite margin pressures, Senco Gold maintained operational momentum across retail operations. Retail sales grew 50% YoY to Rs 2,651.5 crore, supported by robust same-store sales growth of 39%.
The company’s performance was boosted by key festive and wedding occasions in the early part of the quarter, including Poila Boishakh, Akshaya Tritiya, Baisakhi, and Bihu. Old jewellery exchange played a crucial role in maintaining sales momentum amid high gold prices, accounting for 43% of total sales quantity.
Diamond jewellery also posted strong growth, expanding 43% YoY in value terms and 18% in volume terms. This expansion was largely driven by demand for lower-ticket offerings priced below Rs 50,000 under the Everlite collection.
Showroom expansion and subsidiary impact
During the April-June period, Senco Gold expanded its network by adding eight net new showrooms, taking its total count from 201 stores as of March 31 to 209 showrooms by June 30. The group remains on track to add another 12-15 showrooms during the rest of FY27, focusing on Tier-2 and Tier-3 cities and franchise partners.Subsidiary performance weighed on consolidated results. While Senco Global Apparel turned a profit, losses at Senco Gold Fine Jewellery LLC and Dubai-based SGJTL weighed on overall group profitability amid geopolitical uncertainties and the war.
Management commentary on performance and outlook
Suvankar Sen, Managing Director & CEO of Senco Gold, expressed confidence in the company’s underlying growth trajectory.
“We are pleased to begin FY27 with a strong Q1 performance, building on the momentum achieved in FY26. Consolidated revenue from operations increased 67% YoY, reflecting the continued trust of our customers in Brand Senco and broad-based demand during the festive and summer wedding seasons,” Sen said.
Looking forward, Sen noted that while Q2 is seasonally softer, Senco Gold remains focused on new design launches, store productivity, and margin protection. “We remain focused on achieving 20%+ value growth in FY27 while strengthening Brand Senco across the country,” he added.
Sanjay Banka, Group CFO & Head IR, highlighted that the company reduced quarterly inventory by Rs 300 crore to optimize efficiency and inventory days.
“We remain committed to FY27 value growth of 20%+ and EBITDA margin of 7.5%-7.8%, while working towards a sustainable PAT margin of 4%-4.5% with a sharp focus on Return on Capital Employed,” Banka added.
