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Organised jewellery likely to witness 12-15% growth in revenue terms in FY24, says ICRA report




Investment Information and Credit Rating Agency (ICRA) cites aggressive retail expansion by most players, along with a steep increase in gold prices (10-12%), as likely factors that aided revenue growth during FY23

The organized jewellery retailers are expected to clock 12-15% revenue growth in 2023-24, mainly aided by expansions planned by most large players, a report by the Investment Information and Credit Rating Agency (ICRA) said.

Organized jewellers are expected to record revenue growth of 12-15% in FY24 despite a high base and evolving macro-economic environment, against the expected industry growth of 8-10% YoY, ICRA said.

ICRA expects industry growth to be moderate at 8-10% YoY (in value terms) in FY24, with volume growth likely to remain constrained by expected volatility in gold prices amidst global macro-economic uncertainties and evolving domestic inflation.

Nonetheless, the strong cultural affinity of Indians to gold is likely to support festive and wedding demand for gold jewellery, it added.


“Most jewellery retailers are estimated to have recorded revenue growth above 15% YoY on Akshaya Tritiya 2023. The aggressive retail expansion by most players during FY23, along with a steep increase in gold prices (10-12%), are likely to have aided revenue growth. In contrast, volume growth remained muted in the light of the high base, evolving domestic inflation and volatility in gold prices,” Kaushik Das, ICRA Vice President and Co-Group Head, said.

In terms of profitability, the operating margin will likely remain comfortable and stabilize at around 7.5-8% over the next two years.

With the debt protection metrics and liquidity position of players in the sample set expected to remain comfortable, supported by higher earnings on the back of improved scale of operations, the industry outlook is stable, ICRA added.

While ICRA projects the operating margins of organised players to witness some moderation in FY24 owing to higher operating costs for new stores and increasing competition, the benefits of economies of scale and the likelihood of inventory gains for some jewellers in FY24 are likely to support the operating margins in the range of 7.5-8% over the coming years.

Despite the projected increase in debt levels to fund the inventory for new stores, the debt protection metrics for the larger players are estimated to remain comfortable, as reflected by the estimated interest coverage of more than five times and total outside liabilities to tangible net worth ratio of fewer than 1.5 times over the next 12-18 months, against 5.6 times and 1.4 times, respectively, estimated in FY23, the report said.

Courtesy: Indian Retailing

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