Ladies and gentlemen, good day and welcome to the P N Gadgil Jewellers Q2 and H1 FY 2026 Earnings Conference call hosted by Motilal Oswal Financial Services. As a reminder, all participant lines will be in the listen only mode, and there will be an opportunity for you to ask questions after the presentation concludes. Should you need assistance during this conference call, please signal an operator by pressing star then zero on your touchtone phone. Please note that this conference is being recorded. I now hand the conference over to Mr. Naveen Trivedi from Motilal Oswal Financial Services. Thank you, and over to you, sir.
Yeah. Hi. Good afternoon, everyone. On behalf of Motilal Oswal, I'm Naveen Trivedi, would like to welcome you all to the P N Gadgil Jewellers Q2 FY 2026 earnings conference call. From the management today we have, represented by Mr. Saurabh Gadgil, Chairman and Managing Director, Mr. Firodia, Full-time Director and CFO. I would now hand over the call to management for the opening remarks. Over to you, Saurabh.
Yeah. Thank you, Naveen. Good afternoon, everyone, and thank you for joining us today for the P N Gadgil Jewellers Q2 FY 2026 earnings call. I hope all of you had the opportunity to go through our financial results, press releases, and investor presentation, which are also available on the stock exchanges as well as on the company website. This quarter, gold prices continued their upward trajectory, rising over 50% year-over-year and in high teens on a quarter-over-quarter basis. Despite this sharp increase, consumer sentiments remain highly encouraging. The initial momentum was steady and gained strong traction as the early festive season began, with Navratri providing the perfect finishing touch to end the quarter on a high note.
We launched eight exclusive stores during the quarter, five company-owned FOCO stores and three franchisee-owned FOCO outlets, taking our total store count to 63 at the end of Q2. This quarter also marks a significant milestone in our expansion journey, as in line with our communication last quarter, we successfully entered new markets beyond the Western region, opening stores in Indore, Madhya Pradesh, and Lucknow and Kanpur in Uttar Pradesh. Our teams carry out extensive research in selecting these locations and we strongly believe that these new out-of-Maharashtra markets will play a pivotal role in the growth playbook going forward. For H1 of FY 2026, our consolidated revenues from operations stood at INR 3,892 crores. Gross profit came in at INR 484 crores, up almost 77% year-over-year, reflecting an improved product mix.
EBITDA was INR 266 crore, registering a growth of 101.3% year-over-year, while net profit rose to INR 148.7 crore, higher by 101.6% year-over-year. The net profit margin expanded to 3.8% compared to 1.9% in H1 FY 2025. The company delivered exceptional performance in this quarter, driven by healthy growth across all categories, retail, e-commerce and franchisee segments. Early festive demand, particularly during Navratri, resulted in record-breaking sales of INR 428 crore, an exceptional 16% rise year-over-year. Our Q3 have already started on a very high note, with Dussehra and Diwali sales setting new records and extending the overall sale for the month of October to over INR 1,800 crores.
We expect this strong trajectory to continue and remain confident for the year ahead. Our pan-India expansion program is progressing well, with around 13 to 15 new stores planned in the second half of the year. Having already entered Uttar Pradesh and Madhya Pradesh, we are now exploring additional opportunities in Bihar as a part of our broader vision to become a pan-India leading brand. We remain on track to achieve our target of 76 to 78 stores by March 2026. With that, I would hand over now to our CFO, Kiran Firodia, who will take us through the financial results in detail. Thank you, and over to you, Kiran.
Thank you, Saurabh, and good afternoon, everyone. I'll now walk you through the performance highlights for Quarter two Financial Year 2026. For the quarter, consolidated revenue from operations stood at INR 2,177.6 crore. Gross profit rose by almost 91% year-over-year to INR 258.1 crore, with the gross margin expanding by 510 basis points to 11.9%. EBITDA grew by almost 117% to INR 142.9 crore, reflecting an EBITDA margin improvement of 327 basis points to 6.6%. Net profit also surged by 127% year-over-year to INR 79.3 crore, with the net profit margin rising by 190 basis points to 3.6%.
Our retail segment, which accounts for around 72.2% of total sales, continues to be our largest growth engine, with a revenue growth of 29% year-over-year, with an EBITDA margin of 9.1% and PAT margin of 4.1%. Beyond retail, both e-commerce and franchisee segment delivered strong performances. E-commerce revenue grew at 143.5-
Sir, sorry to interrupt. Sir, sorry to interrupt. Your voice is breaking.
Am I audible now?
Sir, you are audible. Can you come again, please? Sir, please hold on. Let me reconnect you to the line. Ladies and gentlemen, please continue to hold on. We are reconnecting to the management line. The line for management has been reconnected. Please go ahead, sir.
Apologies for technical error, now I'm hopeful that you people are able to hear us clearly.
Yes, sir.
Our e-commerce revenue stood at INR 143.5 crore, registering 113% year-over-year growth, while franchise revenue rose to INR 340.8 crore reflecting 105% increase year-over-year. On the customer front, engagement continues to strengthen. Our transaction volume were up by 18%, with an average transaction value of INR almost 1 lakh. Footfall grew by 20%, supported by a conversion rate of 93%, demonstrating a sustained consumer interest even with the rise in the gold prices. Festive sale played a major role in driving growth, highlighted by record sales of INR 428.1 crore on Navratri, marking a 66% increase over last year, underscoring strong festive momentum. We also saw a significant increase in the studded jewelry mix, taking the studded ratio to 9%, reflecting a clear shift in the consumer preference towards more design-led aspirational products.
At store level for H1 2026, our per store revenue stood at INR 61.8 crore and net profit at INR 2.4 crore per store. During the quarter, we further strengthened our retail presence in Maharashtra with the launch of our flagship store in Dadar, Mumbai, a key milestone that strengthen our brand visibility in one of India's most prominent jewelry market. Our flagship event, Mangalsutra Mahotsav and Painjan Mahotsav, received a record customer participation and contributed meaningfully to the top-line growth. Looking ahead, we are optimistic about sustaining this growth momentum while the upcoming wedding season expected to drive strong consumer demand. CRISIL has reaffirmed our long-term rating at CRISIL A+ and our short-term rating at CRISIL A1, underscoring our strong financial discipline and prudent capital management.
In summary, quarter two financial year 2026 marks another quarter of robust and broad-based performance with strong early festive momentum, healthy margins, and expanding geographic reach, reaffirming our position as one of India's most trusted jewelry brand. That concludes the financial highlights for the quarter. We can now open the floor for questions. Thank you.
Thank you, sir. We will now begin the question and answer session. Anyone who wishes to ask a question may press star and one on their touch-tone telephone. If you wish to remove yourself from the question queue, you may press star and two. Participants are requested to use handsets while asking a question. Ladies and gentlemen, we will wait for a moment while the question queue assembles. The first question is from the line of Mr. Raj from Finvestors. Please go ahead.
Yes. Congratulations on very good set of numbers, sir. My question is, sir, how is the adoption of gold jewelry as we have seen such a spike in gold prices in last one year? When do you expect to come to those kind of volume growth in the business?
Raj, thank you for your question. This has been spoken for quite some time now, the impact on high prices on consumer demand. We have seen that in spite of these high prices, demand remains buoyant. Diwali, the entire festive season has been a record-breaking season. Value growth has been enormous as you see from our numbers, but we have also seen positive volume growth at the company level. The consumer interest in jewelry remains strong, and now with the upcoming wedding season in the month of December, January, the road looks pretty positive. All in all, the rising prices has had no impact on consumer demand. Both investment demand and jewelry demand have been strong as we speak.
Just one clarification from your side, that when we compare this result with last year's results, there is a revenue from the refinery. Till when it will come in the results?
If you see the financial security, the revenue from refinery was up to 30th September 2024. After that, there has been no refinery operation revenue accounted for. For this, when you compare the H1 versus last H1, there has been no refinery business. Just to put your thing on quarter-over-quarter basis, as quarter ended September 30th, 2024, the refinery business was around INR 350 crore, which now is zero in this quarter.
What could be the PAT or EBITDA effect by excluding this business?
Sorry?
What could be the PAT or EBITDA effect after excluding this business from our right now main business?
I think PAT, what we have posted currently for FY 2026 Q2 is 3.6%. That is without considering the refinery sale. That you will see in coming few quarters as well, that we will definitely try to maintain our PAT levels with the same margin.
From next first quarter onward, this refinery business will not be accounted for.
Correct. This is last quarter, wherein you are able to see the comparison of refinery sales as compared to last year H1. Now onwards, there is completely apple-to-apple comparison. There is no refinery sale you will see from quarter three onwards, from last year as well as this year.
Oh, fine. Finally sir, on EBITDA margin percentage, our larger peer, I see they are having substantial EBITDA margin. We have been EBITDA margin of, I think, 6.5% or slightly above.
Correct.
What is your take on the EBITDA margin and what lesser we are doing or how better they are doing? How far we are from them?
Yeah. EBITDA margin also consists of retail and non-retail. In case of retail, our EBITDA margin is almost 9%+, and at company level, our EBITDA margin, we are improving on quarter-over-quarter basis. This improvement you will see in coming quarters in the same pace. We are hopeful that we will continue the same margin level for next balanced portion of the financial year as well.
Okay. Thank you very much, sir. After all, even having the spike in the gold prices, these numbers are very good excluding the refinery number. I hope the same momentum will continue for the rest of the year. Thank you, sir.
Thank you.
Thank you. The next question is from the line of Mr. Ronit from Finavenue. Please go ahead.
Hello, am I audible?
Yes, sir. Please go ahead.
Good evening, sir. Many congratulations on your great result. My question is, can you share the number of active customers you have in your scheme, such as this Future Plan, Dajikaka Promise Plan, Golden Gain, Suvarna Lakshmi Labh Plan?
We'll share the entire detailed list with you. I don't think we have the list right now, in value terms, we can share you the total amount collected in value under these various schemes which are spoken about. These finally all lead to purchase. They all convert into jewelry purchases at the end of the expiry.
Okay.
In terms of the value in these schemes
I'll explain. As on September of current financial year, we have a Golden Gain Plan of almost 53 kg and Suvarna Lakshmi Plan is almost for 63 kg, totaling 115 kg, which is completely hedged on the MCX. There is no risk in terms of whatever plan we are currently running in our company.
Okay, what percentage of sales that would contribute to?
Yeah, definitely, since both the schemes we have launched this financial year, definitely-
Total contribution would be around 10% from this scheme because there are schemes in quantity and schemes in value. The total sale from this would be in tune of around INR 700 crores, which would be in the range of around 7% to 8% of the annualized sales.
Okay. Sir, one more question. What would be your guideline for the coming two to three years?
The guideline which was mentioned in terms of store expansion, we already said this in the last call also that we are looking at targeting around 78 to 80 stores by March 2026. Then we'll be adding another 30 to 35 stores in the next two years. By end of March 2028, the company aims to reach 150 stores, which will be a mix of franchisee, company-owned stores, and both the PNG traditional store and the lightweight jewelry, PNG Litestyle store. That is what the guidance has been, and we are on track for that. As we mentioned update, we should be reaching around 70 to 80 stores by end of March 2026.
Okay. Thank you so much, sir.
Thank you.
Thank you. The next question is from the line of Mr. Nitin Jain from Fair Value. Please go ahead.
Hello.
Yes, sir.
Hello.
Yeah, Nitin, go ahead.
Can you hear me?
Yes.
Yes, sir. We can hear you.
Thank you for the opportunity, congratulations on a great quarter. My only question is, the stores that we have opened outside of Maharashtra, post their festive season, what kind of traction are we seeing in the stores? Thank you.
We have launched three stores outside Maharashtra in Goa. One has been in Indore and two have been in Uttar Pradesh, Kanpur and Lucknow. All the three stores started on a very positive note with the festive season around the corner, post that they are doing a performance in tune with the overall market. As per the target which we had set for the stores, the stores are on track. Both in terms of footfalls and conversion, the stores are on track to be able to achieve numbers which we had projected.
Right. In terms of breakeven, they are following the trajectory of the Maharashtra store.
We had said that we'll be needing another three months more for states stores outside Maharashtra. We had said 15 to 18 months for stores in Maharashtra and 18 to 24 months for stores outside Maharashtra. We don't see any deviation there. The stores are on track. The response has been positive because for us, the main criteria is the footfall in these new stores in the geography outside Maharashtra, the footfall has been strong. That's a strong indication that we should be able to guide and achieve what we have been seeing in our past calls also.
Sure. That's very helpful. Thank you.
Thank you. The next question is from the line of Mr. Dinesh Kulkarni from Finsight. Please go ahead.
Hello, sir. Am I audible?
Yes, sir. Please go ahead.
Okay. Thank you very much. Really great set of numbers. Sir, my question is, I know we are adding quite a few stores in Maharashtra and around nearby states, but do you think, have we captured the whole of Maharashtra yet? What is the plan for the next three, four years? Are we fully penetrated in Maharashtra and around Delhi? It's good to go for states outside this region. How good we are in Maharashtra itself, sir, if you could explain something on that.
Yeah. Thank you. See, we have always mentioned that Maharashtra is a fast-growing state and newer pockets are always coming up. In spite of our expansion outside Maharashtra, we always have our eye on Maharashtra. That being said, even in our existing, for next two years growth, we have always targeted 10% to 15% of the stores to be in Maharashtra. That means around three to four stores could be in the state of Maharashtra and the rest could be outside Maharashtra. Like you rightly said, Maharashtra is a vast state and newer pockets are always coming up. There will be always an eye on that. Right now we are well covered in Maharashtra as far as PNG is concerned.
As far as Litestyle by PNG is concerned, there is a lot of opportunities there because there are a lot of new markets where we have not launched Litestyle. On Litestyle, we could see further store launches in Maharashtra. For PNG, we see primarily we will be looking at the neighboring states, the central India region, as we have spoken. The objective will always be that starting stores where we feel the market is there and where the market is currently under service and there is potential for us to enter that market. Our market research and our sales team are always on the lookout for such new areas.
Okay. Sir, as you discussed previously, say if the gold prices remain so high which we know, say above INR 100,000, do you think the kind of volumes we know the festive season definitely boosts and helps the wedding season and festive season, sir, over a period of time, if the prices remain so high, have we done some kind of a sensitivity analysis? Assume the prices remain so high for the next three, four years, assuming the uncertainty around the global financial markets, do you think the volumes will still hold, or do you think there will be a decline in the volumes?
The entire profitability of the industry is based on value. Your making charges are a percentage of the value of the entire gold cost. As long as you are being able to grow in terms of absolute value, your income is going to keep on growing. That is what we have seen also happening in this space. Just to add to your thing of gold prices going higher, in India, gold is not just jewelry or fashion, it's also emotion, it's a religion. It's a part of a tradition. People are using old gold as a currency to buy new gold. Today, almost 55% to 60% of entire jewelry purchase is very sharply happening to old gold. That is ensuring that the volumes are also intact and the margin from the making charges are on the positive side.
I think we don't see any pressure in terms of these prices. People always look at gold as appreciating asset, it's not just an investment, it's an emotion. I think from that perspective, the numbers should not see a concern even if prices go up.
Okay, sir. Thanks for the answer. Sir, just two quick suggestions which I have because I'm a customer as well of the stores. I recently visited quite a few stores in here, Pune, in Chinchwad area. One thing is, sir, when I'm searching P N Gadgil Jewellers, right? By default, even Google still returns PNG Sons. I know it's kind of a competitor today with us.
No, that's working on that.
Yeah.
See, Google works on certain algorithms.
That's.
That's the thing which we're already working on. This also has been said by some other customers. Duly noted, we're working on this.
Yeah. One more thing, sir. I'm also using the app as well, P N Gadgil app, and it's really not user-friendly yet because even though I'm having a user account, it's not allowing me to enter my details and log me in. Since there is some work needs to be done on those, that front as well. It is just a suggestion from an investor cum customer.
We will work on this.
Please take. Yeah.
App today has been used by a lot of customers for making their payments and for browsing. Definitely we'll see if there is a bug and we will work on that.
Yeah, it's real. Thank you very much, sir. All the best.
Thank you. The next question is from the line of Mr. Naveen from Motilal Oswal Financial Services Limited. Please go ahead.
Yeah, Saurabh. Saurabh, if you can just give us some more trends about how has been the festive kind of trends of October, if you can share about how has been the festival season out there. Since we are kind of in the middle of November, have you seen any kind of a deceleration in November?
October had been a bumper month. We have also given a release to the exchange that we had the highest Diwali sales ever. The entire month has been record-breaking sales. We have crossed INR 1,800 crore plus in a single month. Another highlight has been the strong support from the studded category, which has shown a very high increase. The reinforcement of people's faith in gold as investment and as jewelry, both has been reinforced again during this time. In terms of post-Diwali, there is always a little slowdown in the month of November, which we have seen. As prices are going up, markets have picked up. Even this month, the guidance for the quarter, I think we should be able to achieve that, is what we feel right now looking at the overall market sentiment. Silver has been doing exceptionally well. Has seen very good traction.
All the cylinders are firing. I think that there should not be any deviation from what we are projecting for the upcoming quarter and for the upcoming H2.
Fair point. With respect to our store opening guidance, are we revising any guidance and how are you placing second half with respect to store expansion in Maharashtra and new states?
No, we stick to the same guidance. We had mentioned that we will be touching around 78 to 80 stores as of March end 2026. We include a combination of PNG and Litestyle and COCO and FOCO. We stick to the same guidance. I think, both in terms of the expansion, in terms of the numbers, I do not think there is any deviation from what we have been speaking. I think as we speak, the guidance remains the same.
Our entry in MP and UP has been kind of we targeted the top cities in those states. One, we should look for similar cities, more stores, or you think that the top five cities of these states will be kind of a lookout for store expansion for this year and the next year sort of a time frame?
Naveen, both these states or the three states, primarily MP, UP and now adding Bihar to it, we are looking at adding more cities. As we speak in MP, we're looking at Bhopal, we're looking at Jabalpur, we're looking at Gwalior. Banaras, we're looking at this one, Prayagraj, and a couple of more cities. There's expansion in different cities and also looking at more markets in the existing city. Dedicatedly, we are doing market research, where we exhibition in those places, getting a lot of inputs, market intelligence. The plan would be to focus on states and like we had spoken before, it will be a regional focused play. Look at a particular region and be a player of dominance in that region. We continue to stick to the same model.
The region where we have mentioned the central India belt, starting from MP, UP, Bihar, Chhattisgarh, Jharkhand up to Odisha and Delhi NCR is what will be in the focus for the next two and a half years.
Sure, Saurabh. When I look at the other expenses side, certainly there is a kind of a big jump versus year-over-year and even sequentially there is a big jump versus quarter one. Is it to do with new stores expansion, where we had kind of a scrutiny on the new states, both Indore and Lucknow side? How should we look at the run rate in the coming quarters?
Yeah. Hi, Naveen, Kiran this side. Other expenses, you are right. They are because of basically the advertisement cost that the media and all these things that we have already anticipated in the beginning that when we are going ahead with the expansion, then this cost is definitely going to be on a higher side. I think predominantly these are the costs.
How should we look at this number either as an absolute number for the second half or any percentage of sales. How should we look at this number?
What we are thinking is that it should not cross 1.25%, 1.5% of the total revenue, the entire marketing spend.
Okay. That you're saying only for the marketing. I'm talking about the total other expenses, which this quarter is close to 5.1% of revenue. If I look at the first half, also it's close to 4.95% sort of a number. Should we assume that this number as a percentage will maintain for the year or you think that a lot of expenses were on front end and maybe the second half we may not see such kind of high expenses side?
No, Naveen, the thing is, whatever expenses we have booked for particular September up to September, there may be slightly incremental expenses because this H1 we have opened almost 11 store and we have a plan to open remaining 14 stores or probably additional 16 store by H2. You will see slightly incremental in the marketing spend.
Naveen, overall, like Kiran mentioned, the 1.2% of the total top line is what the marketing will be capped at. There will not be any huge incremental hike in marketing also for the entire year.
Sure. My next question is on the gross margin side. Quarter one, we were close to 13% margin, we are guiding that maybe this is a number which is kind of sustainable for coming quarters also. From that lens point of view, it is like 12% margin this quarter. Even on a year-over-year basis, it is on a higher side. When I look at the quarter one is slightly on lower side. How should we look at one second half number and maybe on a medium-term, how to look at this gross margin trend?
As compared to quarter one versus quarter two, Naveen, this quarter two, there is no major festival as such. We have opened the new store. More or less, our intention is to do the replenishment. We have to ensure that our stock level should be maintained at the same level. The real improvement you will see in quarter three. In quarter one also, you will see there is only one festival, Akshaya Tritiya. Gudi Padwa also shifted to last year. We are expecting that quarter three, you will see, as compared to quarter two, high margin improvement in the gross margin.
Sure. Broadly, at a EBITDA level, close to 5.5% to 6% can be expected as EBITDA margin for the year?
Yeah, of course. At a company level, definitely.
Sure. Anything on other income side, like with this quarter we have seen big jump in the other income side?
Yeah. Other income, as I told you, it is basically our fixed deposit, which we have done for the GML purpose. That is the interest that has been captured. At the same time, there are gain on the derivative instrument. That is also we have to book, because that discount we have captured at the other expense, but the gain we have to account for in the other income. That is the reason that has been shifted up.
So part of the other income will be sustainable?
Yeah, of course.
And how much likely-
Naveen, the thing is, my total fixed deposit with the bank is roughly INR 750 crore. On that, I am having my fixed deposit at 7.5%. That you will see on a continuous basis. Only thing is, we have to account for as and when on a quarter-on-quarter basis.
Okay. Broadly, I think around INR 50 crore other income will be there from fixed deposit side. Is my understanding right?
Correct.
For the whole year.
Yeah. For the whole year.
Yeah.
There can be lumpy on a quarterly basis, at an annual level can be-
That's right.
INR 55 crore sort of a number.
That's right.
Sure. That's all from my end. I will give it to you again.
Thank you. The next question is from the line of Mr. Aditya Agarwal from Finn Avenue. Please go ahead.
Good afternoon, sir. Am I audible?
Yeah. Good afternoon.
Yes, sir.
Go ahead.
Sir, I just wanted to know our guidance towards studded ratio. Like as of now, we are having a studded ratio near to nine or 10%, whereas leading players such as Titan and Kalyan are having a studded ratio of near around 20% to 25%. Do we have any plans to increase studded ratio from here on in next two to three years? If yes, can you please guide on the same?
Definitely, studded ratio has been increased. As we have spoken before also that we started five years ago with almost a zero studded ratio, which today is around 10% on a growth volume. The company aims to reach 12%, 13% in the next two years, that has always been the focus. We have recently also launched Polki and Kundan jewelry, which is another addition to the studded category. Colorstone jewelry also is doing well. We are confident that the studded ratio will keep on growing. If you have seen in the financials, the margin increase has primarily come from the higher sales of diamond and solid jewelry. That's the area which we continue to focus on.
Yes, sir. Sir, like our inventory, can we guide on the hedging policy of our company on the inventory side?
Yeah. We are doing 100% effective hedging on month-on-month basis. That's the same thing we are keeping continue for last almost nine months after the IPO.
And sir, whenever gold is sold from our stores, hedging losses we book in that current quarter only.
Yes.
In the PNL statement?
Yes.
Okay. Sir, thank you so much.
Thank you. The next question is from the line of Mr. Rajiv from Nuvama. Please go ahead. Mr. Rajiv, are you on the line?
Yeah. Good afternoon, sir. Thanks for the opportunity. On the hedging part, are we completely hedged on silver side as well?
Yeah. Silver side, during the festive season only, we are keeping our position hedged. Otherwise, we are using the replenishment model for silver.
Okay. You made a comment that in other income, there is a gain on FX. I think there should be a loss because of the hedging part, right?
No. The thing is, we have launched the scheme in the month of September that you can book the metal by paying 50%, and at the time of festive day, you can buy the product at the lower price or the market price, whichever is lower. Exclusively for that purpose, we have taken the forward cover.
Okay. Got it.
Only for that purpose we are having the gain, because ultimately, whenever you are launching any scheme, you have received the advance and that is fixed order, so I have to hedge it.
Sure. If you can call out, what is the SSSG on a year-over-year basis? Sir request, if you can publish that number also in the presentation.
Yeah. Year-over-year, if you see the SSSG in terms of volume is more or less same. Quarter-over-quarter, there is 29% growth in the SSSG. Why I am saying year-over-year, there is no improvement in the volume but yes, value-wise, there is slightly growth. The main reason for that is the number of stores. For H1, we have 39 stores last year, and this year H1, we have almost 63 stores. 24 new stores have been added to the kitty. Now, as we mentioned in the IPO, we require minimum 15 to 18 months if the store is in Maharashtra to reach to break-even. Then slowly this store will definitely improve in adding to the bottom line.
You will see eventually in the coming quarter, the improvement in the SSSG for the store which we open after IPO.
The question was, the stores which you had at the end of Q2 FY 2025, which is let's say 28 COCO stores, how did they do on a YOY basis? Let's say, removing the addition which you had over the last 12 months.
As I told you that as we publish the data quarter-over-quarter, there is a growth of 29% in terms of value.
Okay. Yeah, got that. Also on the working capital side, the payable number, which in every quarter basically swells up, how do we think about that in the subsequent months?
Hello, you are not audible, Rajiv.
Can you repeat the question, please?
Yeah. I'm talking on the working capital side. The payable number, I think it's again elevated in this quarter, which usually in the March end again drops. How should we think about that? Because your working capital requirement from the payables would have been higher if not for the payable gains which you had during the first half.
Your question is very valid, Rajiv. Since we are closing on 30th September and we have to gear up for, since that rise on 2nd of October and plus the festival season also in the month of October. Yes, there is slight improvement in the payables on 30th September. Because after the festival, whatever the credit days we have, we have already cleared entire payment cycle.
Just one clarification. I remember at the time of the IPO, typical stores required, I think INR 50, INR 52 crores in terms of investment. Considering that the gold price has seen the kind of rise, what is the, let's say, capital employed per store you're looking now for incremental, say, 3,000 sq ft store?
Now last year, when we have done the presentation, that time we have anticipated that INR 33 to INR 34 crore of the investment with the store size of 3,500 to 4,000 sq ft. That because of the incremental in the gold prices, that minimum investment is around INR 45 crores and the CapEx is roughly INR 2 crores. Around in between INR 47 to INR 50 crores is the amount that required need to be infused for opening of new store.
Got it. That's all from my side. Thanks a lot for all this.
Thank you. The next question is from the line of Utkarsh from BoB Capital Markets Limited. Please go ahead.
Yeah. Hi, good afternoon, sir. Sir, I just need a clarification on two points. First, on the store opening guidance front. You have mentioned that you are looking forward to open 78 to 80 stores by March 2026. Just wanted to know how many PNG traditional stores you are looking to open in the second half of FY 2026, and how many it could be COCO and franchisee store in the second half.
See, we opened one store on 1st October. As of we speak, we are at 64. We plan to add another 14 to 16 stores in the coming six months before March end. Out of that, we have targeted that we should be looking at around six to seven PNG stores and same around seven to eight Litestyle stores. We can say 50/50. Again, out of this, 50% will be company and 50% should be franchising.
Okay. If my understanding is correct, we were having 59 PNG traditional stores at the end of September. We have opened one store in October, so our total store count has gone up to 60. We are looking forward to open another seven stores, say, in the remaining five months of FY 2026.
Yeah. I mean, franchisee may be around seven to eight stores you can say for PNG.
Okay, fine sir. Sir, second clarification I just wanted, what is our revenue growth and margin guidance for the second half of FY 2026 and how much revenue growth we have clocked for October month till date?
Yeah. Utkarsh, this is good question because the H1, which is we haven't seen any major festival, only Akshaya Tritiya, that is also super duper. Now this quarter, which is quarter three, we have completed the month of October, which is Diwali as well as Dussehra. This entire month, October itself, we have completed the turnover of the entire quarter one. Now we are very much positive that after the remaining two months complete, we can definitely reach around in between INR 3,000 to INR 4,000 crore for the quarter. With respect to the margin, definitely, you will see a great amount of improvement in the margin as compared to quarter two.
Okay. Sir, how much revenue growth we have seen in October month, sir, if you can specify?
You see, October figures are not audited, but October the revenue would have been in upwards of INR 1,800 crores.
Okay. Thanks a lot, sir.
Thank you. The next question is from the line of Mr. Nitin from Fair Value. Please go ahead.
Yeah. Thank you for the follow-up opportunity. My question is on the Litestyle format. If you can provide some more color on the breakeven period required in this format and what kind of margins we get here.
Litestyle by name itself is a lightweight jewelry-focused format. The store size would be ranging around 1,500 to a max 2,000 sq ft. This could be on a high street or in a mall, catering to the working woman, fashion-conscious, lightweight-oriented customers. The inventory in these stores would be in the range of around INR 8 crore to INR 10 crore. We expect that these stores should contribute, once they mature, to around 2.5 to 3 stock turns. Around INR 25 crore is what we expect these stores to reach at. The margins would range around 20%-25%. While the gross margin at PNG or traditional store would be around 13%, the Litestyle would be in the range of around 20%-25%. Kiran, would you add anything more on this?
I think what Saurabh has mentioned is correct. Roughly a typical investment of INR 10 crore-INR 12 crore, with the gross margin of around 20%. With this, typically, we say that one year or 1.5, that 15 or 16 months, that particular store will come to a breakeven, that is we are feeling that it's very healthy margins we observe, because last entire 12 months we opened three Litestyle stores. They are doing predominantly good and they are already reached to their breakeven and one store already crossed the breakeven. We are seeing good traction in the Litestyle as well.
That is very helpful. Thank you. My last question is on international expansion. A lot of your peers are reporting good growth in Middle East as well as North America, specifically U.S. Do we also have any international expansion plans on the card?
We have mentioned during our plan for the year that we are looking at adding a store in North America. Somewhere on the West Coast is what we are targeting right now, California, Seattle, where we already have a presence. That is all on the card right now, because we see a lot of more opportunities right now in the Indian market. The company is focusing aggressively on the Indian growth. Yes, we will look at adding one store a year on the international front. Right now looking at North America as a region.
Great. Thank you. All the best.
Thank you.
The next question is from the line of Mr. Lakshmi Narayanan from Tunga Investments. Please go ahead.
Yeah. Thank you. Just want to understand, you have been phenomenally successful in Maharashtra. Now as you actually expand into other geographies, which could be contiguous or even outside Maharashtra, like U.P., et cetera, what are the activations? What are the things you do to actually attract footfalls? You mentioned that the footfalls has been good. Want to understand what are you doing which makes you a trusted name in those states also?
It's a very important question, that's something which is always on the mind of the company when we expand. It's a series of things we do before we enter into market. We do a market survey there, we do exhibition there. We do a lot of groundwork there in terms of creating relations, creating friends of brand. Once we are confident about launching a store, we do a lot of activities around there to spread awareness. We do branding campaigns. We do a lot of physical campaigns in terms of newspaper hoardings, do a lot of online activities. Even when you are on the drive to recruit staff, we also try to get people from the relevant background, which also helps us to get a better understanding of customers.
Having the right product at the store, the right merchandise really helps us to be relevant to the people's requirements there. I think the legacy we carry, the brand positioning we carry, that really is a very important pull factor when we go into those markets. As you saw both in M.P. and U.P., people come to us because they see we are a legacy brand, having deep understanding of the jewelry market, known for its values and trust. Combination of all these things leads us to being able to generate that kind of footfall. It's a very planned approach. We also try to estimate the footfalls per day, footfall per month, then we try to compare that with what is actual.
On that basis, we have said that we are on track to be able to achieve what we had forecasted for these two regions.
Sir, typically, when I look at some of the other geographies, one of the pulling reasons could be some kind of a discount or some kind of reduced making charges, et cetera. Is that something which you actually look at it in those markets where you are? Of course, there are other large, maybe national chains also, regional chains that are around. Do you actually reduce your making charges in those regions? Is that a way you actually look at it?
Making charges are never a factor which converts purchases. A customer may get INR 5 off, but he has to still pay INR 95. The brand, the design, and the service are the key elements, and that is what we believe in. Our discount can just be for a festive season or for an inaugural offer, just more of a respect for the customers as they enter in the market. The company, we always focus on the values more than the discount.
Got it. Any thoughts on this lab-grown diamond that is also, in one side we hear a lot of noise around that. Does that any way impact your sales of studded jewelry?
The fresh jewelry sale has seen a very steady rise. There has been no pressure from lab growth as a company. We have not seen any pressure from consumer side demand in lab growth. As of now, there is no interest in the company to even venture into that category.
Sir, one last thing. Organizationally, we have been focused on Maharashtra. Now that we are actually expanding other, what changes at an organization level you have done in terms of management bandwidth so that the right steps are taken, and then in terms of if there is something going wrong, you actually can pull back. How are you risk mitigating this expansion plan?
We're doing a lot of things on that front, setting up a store operation audit team, looking at increasing the merchandising team, looking at increasing the further development, visit development and exhibitions team to be able to have a better control over our CRM and to get feedback from that visit by experienced senior professionals in those regions. A lot of these things are done. I think that it's very important to be able to not just grow, but to be able to grow profitably and manage that growth.
Sir, one last question if I may. In your total tonnage of sales in gold, how much is actually traded in, essentially people are coming to recycle, and then how much is coming from those campaigns? You talked about some schemes, which is around some X number of kilos of gold you said-
On the jewelry side-
Yeah.
On the jewelry side, around 50% would be old gold, which is exchanged against new jewelry. The schemes, as you mentioned, around 8% to 10% of the entire volume comes from the scheme sales.
This 50 kg of gold thing, is it all of them coming from your own sales, or how much is coming from other places purchased gold?
We as a company, we are very compliant on buying old gold, without an invoice, we do not purchase old gold. Most of this is our own gold. Yes, definitely if it's hallmarked gold from the market with a proper invoice, we also readily accept it. We are seeing that 80% is still our own gold.
The customers who are actually doing this trade-in as well as these, though it is 60%, they may be the same people who are actually buying more gold, right? If you look at it purely for fresh gold purchases would be how much?
That's what we have talked at before, that old gold is 50%. The balance is fresh purchases and because being a legacy brand, almost 70% of our customers are already people who are a part of the PNG family. The cost of acquiring new customers for us is very low because we're able to have a huge database of our existing customers.
Yeah. Thank you so much, sir. This is very helpful.
Thank you. The next question is from the line of Mr. Ronit from Finavenue. Please go ahead.
Hello.
Am I audible?
You're audible. Go ahead.
Sir, how much revenue is from gold, silver, and sale of diamond? Could you bifurcate on that, please?
So-
You did INR 2,178 crore of revenue this quarter.
You want a quarter-on-quarter or how you want?
For this quarter, what is the bifurcation? How much is from gold, how much is from sale of silver, and how much is from sale of diamond?
Yeah. When I see my total 100% revenue, almost 85% is coming from gold and 10% is coming from silver, and the remaining 5% is coming from diamonds.
Okay.
For diamond, we only mean the stone cost. The metal cost is included in the gold we show. That's why when we say that we are around 10% spread, the 5% also is the gold component in that.
Okay. Got it.
Yeah. That is what the breakup is.
Okay. One more question, sir, I have. What's your update on the previous two stores, the Litestyle store you have opened?
Both are like Kiran mentioned before, we have total launched three Litestyle stores. Of that, one have already broken even, two are on the path for it. The sales what we're expecting in terms of being able to do two store runs, we are on track for that. This part is encouraging. We have also hired to do a little work on the merchandising mix. That is what we have right now worked on. Looking at the way the brand is accepted by people, we are confident that the expansion ahead would definitely be fruitful and we'll be able to add to the PNG existing store.
Okay. Thank you, sir.
Thank you. Ladies and gentlemen, that was the last question for the day. I would now like to hand the conference over to the management for closing comments.
Thank you, everyone. We truly appreciate all the participants for taking out time to join the conference and for your insightful questions. We hope we were able to address all of them to your satisfaction. If you have any further queries or would like to know more about the company, please feel free to reach out to our secretary team, our investor relations partner at Explore advisory. Wishing all of you a great day ahead. Thank you very much.
Thank you, sir. On behalf of Motilal Oswal Financial Services Limited, that concludes this conference. Thank you for joining us. You may now disconnect your lines.