Ladies and gentlemen, good day and welcome to the P N Gadgil Jewellers Limited Q4 FY 2026 Earnings Conference Call. As a reminder, all participant lines will be in listen-only mode, and there will be an opportunity for you to ask questions after the presentation concludes. Should you need assistance during the conference call, please signal an operator by pressing star then zero on your touch-tone phone. Please note that this conference is being recorded. I now hand the conference over to Mr. Ayush Adhikari from Nuvama Wealth Management Limited. Thank you, and over to you, sir.
Thank you, Julius. Good afternoon, everyone. On behalf of Nuvama, it's a pleasure to welcome you to P N Gadgil Jewellers' Q4 FY 2026 earnings conference call. From the management today we have Dr. Saurabh Gadgil, Chairman and MD, and Mr. Deepak Vijay, CFO. I would like to hand over the call to the management for their opening remarks. Over to you, Saurabh.
Thank you, Ayush. Good afternoon, everyone, and a very warm welcome to the Q4 and the full year FY 2026 earnings conference call of P N Gadgil Jewellers Limited. I hope all of you had the opportunity to review our quarterly results, press releases, and investor presentation, which have been made available on the stock exchanges as well as on the company's website. Before I take you through the presentation, I would like to begin by expressing my heartfelt gratitude to our customers, employees, our vendors, our partners, shareholders, bankers, and all you well-wishers, whose unwavering trust has been the cornerstone of everything we have achieved so far this year. FY 2026 has been truly a defining year for PNG, a year in which we crossed several meaningful milestones, expanded to new geographies, and reinforced the depth of our 194-year-old legacy.
Most importantly, FY 2026 marked the year in which we crossed INR 10,000 crores of revenue, a milestone for the first time, reporting a full-year consolidated revenue of INR 10,739 crores, a growth of 40% year-over-year. This is a moment of great pride for the entire PNG family, an aspiration we have nurtured for many years and one which we are deeply humbled to have achieved. This performance was meaningfully supported by an outstanding fourth quarter in which the total consolidated revenue grew by 123% year-over-year to INR 3,544 crores, a clear reflection of the strong festive and continued demand across each one of our core business segments. The quarter benefited from a strong wedding and festive season, complemented by record-breaking event-led sales. Starting with our Foundation Day, we recorded a sale of INR 365 crores with healthy contribution across all product categories.
This was followed by Gudi Padwa, a culturally important festival in Maharashtra, where we recorded sales of INR 171 crore, a 38% year-over-year growth. Subsequently, to commemorate our INR 10,000 crore mark milestone, we celebrated a Gratitude Day offer with our customers, in which we delivered a sale of INR 225 crore, a heartwarming response from our patrons that reaffirmed the emotional connect our brand enjoys across markets. Coming to operational performance, the store expansion, including geographical diversification, remained a key theme throughout the year. During the Q4 of 2026, we added 12 new stores, eight COCO, in which three Legacy and five LiteStyle, and four FOCO, one Legacy and three LiteStyle, taking our total store count to 78 as of 21st March 2026. On a full-year basis, we added 25 new stores, reinforcing our position as one of the fastest-growing organized jewelry brands in the country.
Our Q4 expansion also included strengthening our presence in Maharashtra and entering new potential markets like UP with the launch of stores in Gorakhpur and Banaras. Further, I would like to briefly address on the margins, the clarification which I also uploaded on the stock exchanges. As of when you compare Q4 of FY 2026 versus Q4 FY 2025, there's a gross margin dilution of almost 2.3%, 230 basis points. The company had consolidated gross margins for Q4 FY 2026 which went down by 2.3% year-over-year. The three factors primarily which can identify to this are higher share of gold bars and coins in the overall sales mix. This can be attributed to a 150 basis point, a 1.5% decline. The share of gold bars and coin sales in the overall revenue mix rose 28% in Q4 FY 2025 to 40% in Q4 FY 2026.
In value terms, it rose from INR 450 crores to INR 1,400 crores. As this segment operates on a structurally very thin spread, the company's overall core retail jewelry business, the elevated contribution compressed the consolidated gross margins due to consumer shift of gold from consumption to gold for investment in Q4 FY 2026. I would like to once again reiterate that all gold bar and coin sales in the period are purely B2C to customers, and there is no refinery or B2B business in this. Continuing the same point, in Q4 of FY 2026, we saw a 1% lowering in the studded jewelry mix. This was a one-time impact due to the Foundation Day and the Gratitude Day offer, wherein there was heavy discounting on the gold making charges which led to almost a 1% drop in the studded ratio as compared to Q4 FY 2026.
Q3 versus Q4, they are 1% lower in studded ratio. Also, as we have mentioned ahead, with the promotional activities targeting Gudi Padwa and with the Foundation Day and Gratitude Day offer, the marketing promotion and trade discount were excess of INR 50 crores, which again, had impact on the margins. These three together have been able to demonstrate why we have a dip in margins in Q4. If you look at on a year-on-year basis, we are still able to stick to our estimate of 12% gross margin and with almost a 3.75% to 4% PAT levels. Going ahead, there's also a question on the Q4 FY 2026 versus Q3 of FY 2026. Here too, I would like to point out that the franchisee sales proportion had gone up by almost INR 200 crores in this quarter as we added five new franchisees.
The franchisee gross margins are in the range of 2.5% to 3%. This was again, one of the reasons why the margins saw a dip, as compared to Q3 versus Q4. The sale of gold bars and gold coins was, again, one of the factors which led to a decline in the margins in Q4 as compared to Q3. If you look at the business in terms of value, the gold bars and coins in Q3 were INR 1,100 crores, which increased to INR 1,400 crores in Q4. In the similar way, the studded ratio went down by 1%, which again, had a negative impact on the margins in Q4. As far as the company's hedging is concerned, our monthly sales is in the range of around average of 600 kilos. The inventory we hold is around 2,000 kilos.
Our hedging, as we speak, as of Q4, was around 67%. This hedging in the Q4 FY 2025 was in the range of 55%. As committed, we increased the hedging by 10% to 12%. The gain from unhedged portion of sales, in the Q4 FY 2025 was INR 74 crores, in Q3 FY 2026 was INR 45 crores, and in Q4 FY 2026 was INR 20 crores. This was another reason why we are seeing the dip in the margins. Having said this, the company remains committed to the gross margins guidance of around 12% to 13% with an EBITDA of 7% to 7.5% and a PAT of 4%, which also is in line with the current year's performance. I would now ask CA Purushoth to further continue with the comments ahead.
Thank you, Saurabh, and good afternoon, everyone. I will take you through the financial performance of P N Gadgil Jewellers Limited for Q4 and the full year ended March 31, 2026. We are pleased to have crossed the landmark of INR 10,000 crores revenue milestone during FY 2026, a defining achievement in the company's growth journey. For FY 2026, consolidated revenue grew 40% year-on-year to INR 10,739 crores. Gross profit grew 83% year-on-year to INR 1,302 crores, with gross margin expanding by 200 basis points to 12% on a yearly level, reflecting a structural improvement in the product mix. EBITDA grew 90% year-on-year to INR 704 crores with EBITDA margin improving by 180 basis points to 6.6%, which is in line with our earlier guidance as well.
PAT grew 88% year-on-year to INR 410 crores, while PAT margin expanded by 100 basis points to 3.8% in this year versus last year.
ROC and ROE improved to 30.5% and 21% respectively year-on-year on a full year basis. Coming back to the segmental performance, our retail segment continued to remain the primary growth driver, reporting a revenue growth of 51% year-on-year to INR 8,131 crores, led by healthy same-store sales growth of 43%, driven by wedding and festival demand, improved product mix and contribution from newly added stores. The studded ratio for the full year has also increased to 9.9%. The e-commerce segment delivered robust growth of 105% year-on-year to INR 529 crores, reflecting increasing digital adoption and rising consumer preference for convenience-led jewelry purchases. We continue to strengthen our digital capabilities to further enhance customer engagement and accessibility. The franchisee segment also demonstrated strong momentum, growing 83% year-on-year to INR 1,292 crores, driven by store expansion and healthy traction across existing operational markets.
The franchisee-led model continues to support our asset-light expansion strategy while strengthening brand reach across diverse geographies. Our average transaction value, ATV, for FY 2026 stood at over INR 1 lakh, reflecting both premiumization in our basket and the rising aspirational quotient of our customer base. Our key operational metrics includes average revenue per store of INR 137.7 crores, revenue per square feet of 451,000, net profit per store of INR 5.25 crores, and an inventory turnover ratio of 3.8x, together underscoring sustained operational efficiency. Now coming on the Q4 performance. Q4 FY 2026 particularly played a key role in helping us surpass INR 10,000 crore revenue milestone. Consolidated revenue from operations for the quarter grew 123% year-on-year to INR 3,544 crores, driven by robust demand across retail, franchisee, and e-commerce channels. Gross profit for the quarter grew 80% to INR 344 crores. Gross margin stood at 9.7%.
The modernization in Q4 FY 2026 was primarily driven by a higher share of gold bars and coins, a lower-starred jewelry mix in the overall sales mix, and target customer acquisition discounts in the new market, and a bit of the gains on the unhedged portion which are coming in the sales. The higher sales of gold bars and coins contribution reflected a temporary demand shift towards gold as an investment rather than consumption, and further elevated by geopolitical situation. However, with the honorable Prime Minister's appeal and the increase in import duty, we expect consumer behavior to gradually shift, with a greater flow of old gold being exchanged for new jewelry. Over time, this gold, bars, and coins is also expected to find its way into jewelry demand as conditions stabilize.
We therefore view the gross margin impact as largely one time and mix driven, not structural, and remain focused on improving product mix and margins as our store matures. EBITDA grew 53% year-on-year to INR 166 crores with EBITDA margin at 4.7%, while PAT grew 46% year-on-year to INR 90 crores, translating into a PAT margin of 2.5%. Retail grew 102% year-on-year to INR 2,600 crores. Franchisee grew 132% to INR 430 crores, driven by asset-light expansion across tier II and tier III markets. E-commerce grew 67% to INR 152 crores, and other segments contributed INR 357 crores. Our same-store sales growth for Q4 FY 2026 stood at robust 86% year-on-year. Despite the sharp run in gold prices, we saw positive traction in volume. Gold grew 27% year-on-year by volume in Q4. Silver volumes rose 37% year-on-year, and diamond volumes rose an exceptional 155% year-on-year.
We are also pleased to share that during the quarter, our long-term credit rating was upgraded to A+ Stable from A, while the short-term rating was reaffirmed at A.1. The rating upgrade reflects the credit rating strengthening of our financial group for a healthy financial position and discipline that drove growth capital and debt management. This further enhances our ability to access capital at competitive terms as we continue to scale the business. In summary, FY 2026 has been a year of strong and profitable performance, a year in which we crossed the milestone revenue, expanded our network to 78 stores across 36 cities, delivered an EBITDA margin of 6.6% and a PAT margin of 3.8%. As we step into FY 2026 with strong momentum, a clear strategic playbook, and a healthy balance sheet to support our continued growth.
While it is still early to fully assess the overall impact of the evolving situation and we continue to calibrate our strategy accordingly, we are currently maintaining a guidance of INR 13,500 crores revenue, along with an EBITDA margin of 7% to 7.5% and a PAT margin of 4% for FY 2027. Depending on how the market situation evolves during the ongoing quarter, we'll update the guidance if required in the next quarter. We believe our strong operational execution, improving business mix, and resilient demand environment position us well to navigate the evolving landscape. As we step into FY 2027, we do so with strong momentum and a clear strategic roadmap. With that, we now conclude our opening remarks. We can open the floor for questions. Thank you so much.
Thank you. We'll now begin the question and answer session. Anyone who wishes to ask a question may press star then one on your touchtone telephone. If you wish to remove yourself from the question queue, you may press star and two. Participants are requested to use handset while asking your question. Ladies and gentlemen, we'll wait for a moment while the question queue assembles. The first question is from the line of Uchit Shya from Vimana Capital. Please go ahead.
Hi. Thank you, sir, for taking us through the presentation. I just had one quick question. Due to the recent increase in customs duty and the advance authorization that was announced yesterday on import of gold, do you see any impact on the sales or margins on account of this?
Yeah. Thank you for the question. See, as far as the advance authorization is concerned, it's mainly for exporters, people who are importing gold for exporting jewelry. We don't fall in that category, so it's not applicable to us. Our business is purely domestic. As far as import duty is concerned, it's directly passed on to the consumer, so it will not have impact on the margin. What it may have a positive rub-off is it may induce people to buy less of bars and coins, which typically carry lower margins, and may push the interest further to gold jewelry by exchanging old jewelry for new. We are hoping that the jewelry sales will see a further uptake in the year and would be a positive contribution to margins.
Thank you, sir.
Thank you. The next question is from the line of Yashwanten Priya from Edelweiss. Thank you, and over to you.
Hi. Thank you for taking my question. Yash from Edelweiss this side. Thanks for the detailed press release, by the way. I have a few questions. Basically, in the press release, as you already mentioned about the gross margin impact because of different advertisements or the schemes we provided. Earlier you have guided about the BTL, 1.5% we budget for advertisement cost. How should we think about budgeting ATL, like what you provide as a scheme? Because we are entering into new regions, how you guys budget for the same.
Yash, thank you for the question. This was not really regarding more about advertising spend. It was on the trade discount offer, which we had for the Gudi Padwa, and primarily for our Foundation Day and Gratitude Offer. These offers were discount on making charges. We had a fixed making charge of Rupee 310 per gram, which costed the company in the range of around INR 40 crore to INR 45 crore. This is what is the impact, and this is a one-time impact for Q4. We don't see this impact being carried forward ahead. Guiding on the A&P spend, both ATL and BTL, 1.5% is what we would stick to, or in fact, we would try to go a little lower considering the year wherein we are seeing the import duty, where the focus will move more towards exchanging old gold for new gold.
Got it. Which means ideally going ahead, the schemes which we will provide on different festivals will also be included in this 1.5% budgeting.
Absolutely.
Got it. My second question, please correct me if I'm wrong, basically, the LiteStyle business was not in our base, and that is right now 5% to 6% of our revenue, which is like 30% plus studded ratio. Ideally, still year-over-year, the decrease in studded ratio. If I adjust for LiteStyle, the studded ratio has decreased more in the core business. Is my understanding correct? Follow-up on that, any assessment you would like to provide on how to think about this?
Yeah. The LiteStyle business is around an INR 70 crore business. It's only a 0.7% of the entire turnover. It's not what you're talking in the range of 30%. Out of this, around 30% would be studded. It's a very small portion of the entire studded business.
Got it. Thanks for taking my question. Thank you.
Thank you. The next question is from the line of Bharat Gianani from MC Research. Please go ahead.
Yes, sir. Thank you for the opportunity. First question is, what was the proportion of inventory hedging in FY 2026, and what is your plan going forward in FY 2027? Typically, we have seen when the inventory hedging is on the lower side, there is a fluctuation in the margin, which is not liked by the markets. Just wanted to understand your strategy on the hedging side, what the proportion was in FY 2026, and what is your plan for FY 2027? Thank you.
Mr. Bharat, please continue.
Sir, I'm audible now?
Yes, sir, you are.
Hello. Yeah.
Sir-
Yeah. Okay. My question was regarding the proportion of hedging that was there in FY 2026, and what is your plan for FY 2027? As we have seen, when the hedging is on the lower side, typically it leads to margin volatility, which is not liked by the markets. That was my first question. What was your hedging proportion in FY 2026, and what is your plan for FY 2027?
Hi, Bharat. Deepak Vijay . I would like to take this question for you. As Saurabh has already explained that our monthly sales in the range of 600 kgs of gold on a monthly basis. At the end of March 2026, we are covered for 1,300 kgs of gold on the hedging through various GMLs and MCX and other instruments. This is 67%. When I talk about last year, FY 2025 quarter four, we were at 57%. There's an improvement of 10% on the quarterly basis year-on-year. It's a 10% improvement. If I go back to quarter three this year, FY 2026, we improved from 57% to 63%. That's a gradual increase, which we know we don't want a margin volatility in our business. There's an endeavor to completely mitigate this and bring this hedging to over 70%, 75%, maybe 80%.
Right now, what has happened also in the last year that the margin and the premiums on the MCX has gone up to 15% to 20%, which was blocking a lot of the cash. There was a cash burden from that point of view. If we lock those margins, this was very expensive, and we also needed funds for the operation. If you block everything there, then the funds get trapped up there. Even considering that, to cut down the volatility in the margins, we have improved from 57% to 67% already in this year. That also you will see the margin which was there in FY 2025 had a bigger share of unhedged gain and respective to this year for FY 2026.
Okay. Just to hop on this further, the 67% you gave, that was for quarter four. Actually, I wanted the hedging portion for the entire FY 2026, like Q1, Q2, Q3, Q4 combined, what was for FY 2026 and FY 2027. You have already given an indication that you will probably try to move to 75% to 80%. Just wanted the hedging number for FY 2026 entire year. This is Varun Ganani from MCX.
Yeah. Sir, my question was that the 67% hedging percentage that you gave, that was for quarter four. I wanted the hedging proportion for entire year FY 2026. All the four quarters combined, what average was the hedging proportion for entire FY 2026?
Last year in quarter four, we were at 57%. We gradually increased to 63% in quarter three, then to 67% in quarter four. On an averagely basis, we were at around about 60% for the full year.
Okay. This, you plan to take it to 75% to 80% in this year, if I understand right?
We plan to take it to 80% to remove the complete volatility in the margins.
Okay. This 80% will be by FY 2027 or will it take more time?
No, see, we are already at 67% to 70%, this is what we want to continue at. Next year, we should be at 75% to 80%.
Okay. Sir, last question from my side. What is your sense that because of the customs duty increase, how will it impact the demand in the short term? Any comments you would like to give on the same?
We have already launched a program called Suvarna Swaraj, where we are trying to encourage people to come up with old gold lying in lockers, lying into homes, to remake into new jewelry. I think this entire year, the flavor would be towards that. I am expecting that the sale of coins and bars will go down drastically. Prices have gone up and we'll see a lot of exchange gold coming in, which would be beneficial because it'll come up with making charges. I think diamonds should be doing well for the year. I don't see a per se impact on the business. Yes, bars and coins, I think will definitely have impact.
Okay. Thank you, and all the best.
Thank you.
Thank you. The next question is from the line of Pallavi Teshpande from Sashmika. Please go ahead.
Yes, sir. Just wanted to know what is the share of the old gold exchange in your mix for FY 2026? Second, what will be the share of customized jewelry sales in the product range?
Old gold today is around 40% of our entire business. We're expecting that the old gold trend picks up. We should be around 50% plus as far as old jewelry to new jewelry is concerned. Made to order, again, is at around 30% to 35%. I think that should continue at the same level. Maybe if we're looking at a greater exchange of old gold, maybe 3% to 4% can be a further rise in the made-to-order business. Overall, we are seeing that jewelry contribution in the overall mix would effectively see an increase in this financial year.
My last question would be, what could be the share of, I mean, you mentioned in FY 2025, there were some inventory gains. If you could share the absolute amount that would help us in the analysis and the absolute amount for FY 2026 and FY 2025.
Q4 FY 2025, the gains were in the range of around INR 70 crores. Wherein if you look at Q4 of FY 2026, the gains were around INR 20 crores. As we increase hedging, the gains have come down.
Right, sir. Thank you, sir.
Thank you. The next question is from the line of Ankur Arora from InvIT Research. Please go ahead.
This call will be recorded.
Yeah. Hi, sir. Am I audible?
Yes, sir. Please go ahead, sir.
Yeah. Sir, I had few questions. Sir, what is our volume growth in Q4? If you can share your outlook for volume growth for the next year.
Yeah, Ankur. Hi, Deepak here. On gold as a category, we have grown on the yearly basis Q4 FY 2025 versus Q4 FY 2026 at 27% on the entire gold segment. Silver, we have grown 37%. Diamond, we have grown 125%.
Okay, sir. If you can just highlight what will be the outlook for.
The volume I'm talking about. Part of this has been due to our new store addition and also like Deepak had mentioned before, the same-store growth also has been quite strong. It's a combination of a new store and the same-store growth. In volume, we have grown by 27% in gold volumes.
Understood, sir. Any outlook on volume for the coming year, FY 2027?
FY 2027, volumes are a percentage of jewelry and bars and coins. I think bars and coins would see a slowdown in this year. It's very difficult to talk on the exact volume side. We feel that margins which come from making charges should be healthy, and I think when we look at the level of gross margin, EBITDA, and PAT, I think the guidance can be on that front. Net volumes, which include jewelry and bullion, exactly to quantify right now is difficult because it's only been a week after import duty has been hiked. Let us see how much of fresh new gold is being bought.
Understood, sir. Understood. I think another question would be, sir, you had earlier guided for a INR 12,000 crores top line for FY 2027, in your initial opening comments, you have mentioned for INR 13,500 crores of top line. What would be driving this higher growth? Why have we revised our guidance upwards? What would be the driving force for this?
For the year ended March 2026, we had guided for an INR 9,500 crore top line. We crossed that by INR 1,000 crores, and we are at INR 10,700. The good factor has been the response which we received outside Maharashtra, primarily in UP, where the non-Maharashtra states today contribute 10% of the entire business. Also, the same-store growth has been very healthy. We feel looking at these positives, we feel that INR 12,500 can be stretched to INR 13,500, that's where the guidance is coming from.
Understood, sir. That would be really great, sir. Another question would be on the side. I think our B2B bullion sales have increased significantly. How should we think about this segment going forward? Can you explain the nature of this business?
You see, this is not B2B. Pre-IPO, we had a component called old gold, which was sold for refining. We used to sell gold to a refinery and purchase back new gold. As of September 30th, 2024, that has been discontinued, post that, we have not had any sales of refinery gold. Primarily this year, the hike has been due to people's interest in gold as an investment. We have added a lot of new consumers, especially in Q4 of this year, which are looking at investing in bars and coins. These are all B2C sales.
They are not sales which were B2B, the hike has been very high, with our strong penetration in Maharashtra, we have been able to garner a lot of new customers hence the gold bar, gold coin, and what we call as gold rings, which is pure gold, is what has really led to a sharp rise in bars and coins. Which we also see as an investment for this year because people normally use bars and coins to make new jewelry. I think this should be an advance for us where this year people should come with that to convert that into new jewelry.
Understood, sir. Just a follow-up on this, I think your gold bars and coins share was around 40% in Q4. That has impacted our margin. What would be the contribution going forward from this gold bars and coins segment?
We always were in the range of 25%. Previously it was 20%. With gold going up as interest, it had gone to 25% to 28%. Q4 had been exceptional. We had gone to 40%, I think this year it should again stabilize back to that 25% or even lower level. That is what we've been always saying, that this year is going to be a year of a lot of new jewelry being bought using old jewelry, and bars and coins as a category this year will see a slowdown. To give an estimate, we should be at around 25% for this financial year.
Got it, sir. That would be great, sir. Lastly, my question would be on the front of QIP. I think you had told that the progress is going on. If you can just highlight what's the progress on the QIP?
In terms of progress, like I said, there's an enabling board resolution, which is till end of August. That is where we are. We haven't really thought on going ahead on that front at this point of time. We had a good year, so as we move ahead now, there's something which we would want to explore. QIP is not an impediment for us to grow our business. The business is self-sufficient. That's something which we'll address as time goes by, looking at the market condition and looking at the sector.
Sorry for interrupting, Mr. Ankur. Please rejoin the queue for more questions. Thank you. The next question is from the line of Nitin Jain from Fair Value Equities Advisory. Please go ahead.
Yeah. Thank you for the opportunity. My first question is the clarification that the management has provided for the margin drop. Quite a few reasons appear more structural than one-off. For example, discounts that you mentioned on Foundation Day and Diwali. There is a high likelihood that they might repeat next year. Also, discounts you mentioned in the new market. As the company expands to newer geographies, there is a likelihood that they will also continue. The last point is the franchisee share. As we open more and more franchisee stores, FOCO stores, that share also should inch up. Can you elaborate why we think of them as one-offs?
That's a good observation. If you look at it from an entire year perspective, this has not affected the entire annual margin. When you look at the margin for entire year, this has already been absorbed into it. This was primarily Q3 versus Q4 and quarter-over-quarter, where we have seen that we had a lot of franchisee openings in one quarter. That has led to the franchisee margins being low, has impacted margins. You have rightly mentioned that discounts are a part of it, but this Foundation Day offer where we offered gold making at INR 399 and the Gratitude Offer, these were only one-time activities. They are not annual calendar activities. I was saying that these instances for the year are kind of not strategic.
Like I mentioned, firstly, the impact is only a half a percent when it comes to the discount side of it. What really has been the major driver which has got margins down has been the bars and coins, which typically are in range of 25% to 26%, which for Q4 had gone to 40% because of people interest in looking at gold from the investment perspective, and we've garnered a lot of new customers on that front. We also expect that these customers would eventually convert into jewelry in the coming years. The Gratitude Day sale and the Foundation Day were only one-time activities. Gratitude mostly was thanking people for the 75 store success of PNG.
Most of these numbers would not be strategic, and that's why if you look at the entire year, they have been factored into and the entire year numbers margins look on track as what we have projected.
Right. Sir, you mentioned as one of the corrective measures you will be calibrating gold coin sales. Can you elaborate how exactly you will be doing that?
Sorry?
You mentioned in your clarification.
Huh.
that you will be calibrating the gold coin sales, gold bar and coin sales and you will reallocate the capital towards jewelry. Can you elaborate how exactly you would be doing that?
It is being done by the industry where jewelers are encouraged, of not selling more than 5 g of gold coins to customers on a B2C level and looking at more lighter weight jewelry and looking at getting old for new. Encouraging people to exchange old gold jewelry for new. I think this would be effort across the industry. Also, the import duty hike will have a natural impact on gold investment demand going down. This is what we are seeing, that jewelry demand is kind of inelastic, but investment demand is elastic, and when duty has gone up, we see a dip in people's interest in gold as an investment in bars and coins.
Right. My next question is on the guidance for FY27. You have guided for INR 13,500 crores. What impact do you think this import duty hike might have on this guidance?
Import duty hike primarily would have an impact on the bars and coins sale. Like I mentioned before, we don't see an impact much on the jewelry side. If you look at our business in terms of sales, there'll be a portion of bars and coins which would see a negative impact, and I think that should be in the range of 20% to 22% of the total sales. The balance 80% would be jewelry, and that's where we're seeing we'll see a jump. I think there would be a positive impact if any, as far as import duty is concerned. We are also toying with lighter weight jewelry and lighter caratage jewelry. That's something which is on the card for this year also. We're looking at 18-carat jewelry, also 14-carat jewelry.
All this will ensure that the jewelry sales remain intact and would not have a negative impact on the margin.
Yeah. I would also like to add a few numbers here for you for a better understanding. In particular, retail, we have closed down the year at around about INR 8,000 crores, and the next year targets and the guidance for the retail which we have taken in our AOP is around about INR 9,800 crores, which is a 23% increase. If I break this down into how this has come up, this year we have seen an SSG of 43%, primarily driven by the ramp-up of the stores which are not matured for more than one year and two years. For the stores which we have opened for more than three years, we have taken an SSG of in the range of 5% to 10%.
For the newer stores, the ramp-up is annualized, that's very healthy, and similar for one and two years when we increase our stock turnovers on that. This 23% on a base of INR 8,000 crores is very much achievable, and we also don't plan to open too many COCO stores this year.
Yeah? Hello? Are we audible?
Yes, sir, you're audible. The line has dropped. I'll promote the next participant.
Okay.
Which is Mr. Prithish Choudhary from Finswirl. Please go ahead.
Hello? Hello?
Yeah. Go ahead.
Yeah. Sir, my question is that, we have been seeing that inventory turnover ratio has been declining for us compared to the previous year, and also if we see the trend. I just wanted to understand, is it due to the investment done in the new stores, that is why the inventory is high, and is why our turnover ratio has been dropping?
Yes. Absolutely. You are right there. If you see, most of our stores are opened in Q4. We have opened around about eight stores in COCO category in Q4 itself. That is what has not matured into the sales right now, and that's why you see an impact on the stock turnover for the year. Having said that, 3.8% in this industry is a healthy stock turn. That's how we see it. Also, the value has increased on the entire gold as a commodity. Considering all those factors, 3.8 is what we have closed the year on. Primarily, you are right, the impact of new stores which we opened in H2 is the primary driver of this coming down compared to last year.
Okay. Sir, I just wanted to ask, currently if we see that mature stores and our flagship stores. If you see that over the past two, three years, have our inventory turnover ratio there has been stable, or have we seen decline or increase on it?
It has been gradually being flat and declining a bit, not too significantly b ecause of the quarter four this year, which we have taken the stores which we opened predominantly in quarter four has been the major impact in the stock turnover.
Sir, You may.
Sorry for interrupting, Mr. Prithish. Please rejoin the queue for more questions. Ladies and gentlemen, in order to ensure that the management is able to address questions from all the participants in conference, please limit your questions to two. The next question is from the line of Janil Bharat from Prudent Corporate Advisory. Please go ahead.
Hello, am I audible?
Yeah, you are. Please go ahead.
Hello.
Yeah, please go ahead.
I just wanted to know the gross margins for the gold coins and bars segment and the normal jewelry segment.
On the gold bar and coins, we operate on very thin margins in the range of half a percent to 1%. On the normal jewelry, on the gold jewelry, which is non-studded jewelries in the range of 12% to 13%. 12.5% to 13% is the right number to place on the margins for the gold jewelry. There's a delta of 12% to 12.5% between bullion gold bar and the jewelry. What we have been trying to also explain that's been the major driver for the margin drop. Once the sale goes down, which is anticipated for the next quarters in next year because of this recent appeal from the Honorable Prime Minister, the margin should anyways pick it up. That's the guidance.
The franchisee gross margins, I think I heard it was around 2% to 3%. Am I right?
That's right.
Okay.
Their kind of franchisee is like a fall through. All the costs are borne by the franchisee, so the gross margins are almost like net margins.
Okay.
It also improves the return on capital employed heavily within lighter balance sheet.
What would be the ROC on our own stores and the FOCO store segment?
Our ROC for this year, just a few moments again. The ROC is 30.5% for this year. ROE is 21% for this year. On the franchisee, pretty much there is no investment. Everything which goes through contributes to the uptick in the ROC and ROE. Hello?
Okay. No further questions from my side, sir.
Okay. Thank you.
Thank you. The next question is from the line of Paras Kakkar from Finance Ark. Please go ahead.
Yeah. Am I audible?
Yes, sir, you are. Please go ahead, sir.
Yes.
Yeah. My question is the peers in the industry, they have reported their gross margins, EBITDA, in the normal range as compared to Q3. I just wanted to understand what has led specifically the decline on our side. Is it like on the jewelry segment, we are facing some competition, the demand is low? Just wanted the insights on it.
I think we'll have to recheck that at your end also. What we have seen, the results, the big players who are leading the industry, the gross margins have dropped for the quarter FY 2026 versus last year's quarter, is in the range of 600 basis points. That's what the numbers which we have looked at translated. The other players also have shown the similar trajectory in terms of the margin drop, especially in this quarter. Like I mentioned, it is primarily due to a change in product mix, which I think is primary Q4 had a lot of interest in gold investment, which are transferred into a big rise in bars and coins. That really has been one of the major factors. Like I said, given the guidance going ahead, I think this should be neutralized.
Okay. Thank you.
Thank you. The next question is on the line of Yash Sonawalla from Edelweiss. Thank you. Please go ahead.
Hi. Thanks for the follow-ups. Just a quick follow-up. You said 10% of your revenue is from non-Maharashtra region or state. Just want some like-to-like number, like what is the make to order mix and inventory turns over there. I know it's too early to get any view. Still, any like-to-like number.
See, make to order is a little lower there than compared to Maharashtra. Still, it's a good proportion. Around 22% of the entire sales outside Maharashtra are made to order, while in Maharashtra, the number is at 30% to 32%.
Got it. Inventory turns?
Yeah. I will take that question. On the annualized stock turn, while most of these stores have opened only for six months, eight months into the year at the close of the year, we have already crossed stores which are in Bihar at one, UP at one, surprisingly, and to our surprise also, Indore has performed at 1.4 on an annualized basis until now. These are very healthy for the new stores outside Maharashtra, and this gives us encouragement to also venture into these geographies. Like our guidance, we had projected around 0.8 stock turns for the year one, so we have surpassed the guidance and all the stores in primarily U.P., Bihar, and M.P. are doing annualized stock turns of one in the first year itself.
Very encouraging. Thanks. Thanks a lot for answering.
Thank you.
Thank you. The next question is from the line of Sandeep Jain from LKP Securities. Please go ahead.
Yes. Thanks for taking my question. Wanted to check on the outlook of newer store openings in upcoming FY 2027. If you can just throw some light on the newer stores which are going to come in terms of number of stores, as well as on the non-Maharashtra store count in FY 2027, how many stores you are planning to open?
Yeah. Hi. I will take the question, Sandeep. In our outlook, we have planned for five COCO stores, two PNG Legacy stores, and three LiteStyle stores. The locations which we are venturing into is in Gurgaon, strengthening our position in Lucknow. We have also venturing into Gujarat. We will see now with the new strategy what happens, these are the newer locations which we are venturing into. All of them which we have planned this year is outside Maharashtra. We plan to open five COCO and-
Okay.
20 franchises for this year. Like I mentioned, on the asset-light model for the year of 25 stores, we try to do five to seven COCO and the balance will be FOCO. We would-
Okay.
Expanding, further expanding in the state of U.P., Bihar, M.P., but adding Gujarat this year. We are also looking at Gurgaon, which again is neighboring to U.P., but Haryana.
Okay. Overall, just to confirm, is it 25 stores? 20 would be approximately FOCO.
We also have a lot of demand for franchises, right now evaluating it.
Okay.
It is on a digital contract.
Okay. Thank you. Thank you so much for taking my question. Thank you.
Thank you, Sandeep.
The next question is from the line of Bharat Gianani from MC Research. Please go ahead.
Thank you for the opportunity once again, sir. Just two questions from my side. Sir, one, you said that the proportion of gold bars and coins in quarter four was close to 40%, but I wanted the figure for entire year, FY 2026, what was the proportion of gold bars and coins in our overall sales? Hello?
Yeah. Hi. In the overall year, my gold, the proportion of the gold bar is in the range of 33%.
Okay. One more thing. Related to this QIP, the purpose of QIP was that we will raise, obviously, capital for growth and also bring down the promoter shareholding to the 75% requirement. Just wanted to check on the promoter shareholding. We have time till September 26, or we have more time for that?
September 27. We have three years. We list on September 2024, so we have time till September 2027.
Okay.
Thank you.
Thank you.
Due to time constraint, we take this as the last question. I now hand the conference over to management for the closing comments.
Thank you, everyone. We truly appreciate all the participants for taking the time out to join us today and for your thoughtful and insightful questions. We hope we are able to address your queries to your satisfaction. If you have any further queries or would like to know more about the company, please feel free to reach out our investor relations partner, XB4 Advisory. Wishing all of you a wonderful evening ahead. Thank you so much.
Thank you. On behalf of Nuvama Wealth Management Limited, that concludes this conference. Thank you for joining us. You may now disconnect your lines.