Shares of Kalyan Jewellers were tanking on Monday despite posting robust growth for the second quarter, with domestic sales booming.

What Happened: Kalyan Jewellers reported a consolidated revenue growth of around 37% in the September quarter from a year ago. In India, Kalyan's revenue surged by 39%, driven by strong operating performance across all markets, with same-store sales growing nearly 23% during the second quarter.

The company attributed this growth to the reduction in customs duty on gold imports announced in the Union Budget, which led to significantly higher footfalls from the end of July through August.

This increase in demand mostly offsets the typically quieter sales period during the 14-day Shradh season. In contrast, the base year only included two days of Shradh in the second quarter.

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International Growth: In the Middle East, Kalyan Jewellers saw a revenue increase of around 24% compared to the same period last year. The company completed the first phase of converting its owned showrooms into franchisee-owned-company-operated showrooms, bringing the total number of franchised locations in the region to four. The Middle East contributed 13% to Kalyan's consolidated revenue for the recently concluded quarter.

Kalyan’s digital-first platform, Candere, posted a 30% revenue growth compared to the same quarter last year. The company also launched 12 new Candere showrooms during the second quarter of FY25.

Kalyan introduced 15 new FOCO showrooms in India, with plans to open more showrooms in October. The company outlined its strategy to launch over 130 new showrooms during the current fiscal year, in addition to the 51 already opened. It aims to open 25 more Kalyan showrooms in India, 18 additional Candere locations and its first U.S. showroom by Diwali.

As of September 30, 2024, the company had launched 26 new showrooms across Kalyan and Candere formats, bringing its total showroom count to 303.

Shares of competitor Titan Company were also down on Monday as brokerages shared mixed views on the company’s expected bottom-line performance.

Price Action: Kalyan Jewellers’ share price was down 2.34% at ₹696.20 in early trade on Monday.

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