Analysis: Khazanchi Jewellers Limited

Growth thesis

Khazanchi Jewellers transitions from B2B-focused jewelry to a retail-led model, targeting 25% retail sales share by FY27. Growth hinges on the Chennai flagship store (INR 500-600 cr annual sales at 16-18% margins) and diamond brand Vajraa (5-10% sales mix, 16-18% retail margins). FY27 revenue guidance of 25-30% is supported by lightweight/fusion product diversification, 50-day inventory turnover, and pan-India B2B exhibitions. EBITDA margins, currently 6%, are guided to rise 20-30% as retail share expands. Execution depends on maintaining 50-day working capital efficiency while scaling retail without margin dilution.

Why is Khazanchi Jewellers Limited stock rising?

• - Retail mix target raised from 10% to 25% within next 1-1.5 years - New 10,000 sq ft Chennai flagship to add INR 500-600 cr annual retail sales at 10-13% margin - Diamond brand “Vajraa” to reach 5-10% of sales mix
• diamond B2B margin 10-12%, retail 16-18% - FY27 revenue growth guidance 25-30% across all verticals - EBITDA margin roadmap: FY26 exit ~6%, medium-term 20-30% uplift as retail share rises - Inventory cycle target 50-60 days
• diamond inventory 180 days, gold 50-60 days - Capex for flagship INR 12 cr
• 1.5-year payback
• funded via internal accruals - South-India-first retail roll-out: 4-5 company-owned stores by FY28, then assess franchise - Bullion share to be reduced from 25% to improve blended margin - Lightweight, 18-carat, fusion jewellery ramp-up to offset gold price elasticity - ERP, omnichannel app, real-time inventory tools being deployed for scalable operations - Participation in pan-India B2B exhibitions to add 2,000+ active wholesale customers - Natural diamond focus

Research report

Khazanchi Jewellers Limited is a Chennai-based jewellery brand that has operated in the gold, diamond, and precious stone jewellery market since 1971. The company runs a dual business model: a wholesale (B2B) division that supplies finished jewellery to retail jewellers across India, and a retail (B2C) division that sells directly to consumers through company-owned showrooms. B2B accounts for approximately 90% of revenue and B2C for approximately 10%. The company also trades in gold and silver b...

Catalysts

capex, margin expansion, new product segment

Growth guidance

25-30% revenue growth for FY27; retail share to rise to 25% by FY27

Management consistency

overdeliver