Senco Gold shares surge 5% to record high; stock up 212% over past year 

The company anticipates a growth-oriented year, bolstered by favorable market conditions and a focus on innovation and sustainability  

Mumbai: Senco Gold & Diamonds saw its shares hit a new high of Rs 1,252.10 on Monday, driven by a 5% intra-day rally on the BSE. This increase reflects a robust outlook for the company and the broader jewellery industry, which is benefiting from expanding retail presence and positive market conditions.  

Year-to-date, Senco’s stock has surged 75%, significantly outperforming the BSE Sensex, which has risen 12.3%. Over the past year, Senco’s shares have skyrocketed 212%, compared to a 21% gain in the BSE benchmark index. 

Senco Gold offers a diverse range of jewellery, including gold, diamond, silver, platinum, and various precious and semi-precious stones. The company’s brand portfolio features “Everlite” for lightweight jewellery, “Gossip” for silver and costume jewellery, and “Aham” for men’s jewellery. Additionally, Senco’s premium wedding collections include “Vivaha” and “Rajwada.” As one of the largest organised jewellery retailers in eastern India, Senco is poised for continued growth. 

Recent reductions in customs duties on gold and silver to 6% and on platinum to 6.4% from 15% are expected to boost demand, especially for the June quarter. The lower gold prices are anticipated to drive more customer footfall and increase market share for organised retailers. However, the duty cuts could impact inventory valuation and affect gross margins and EBITDA in the next 2 to 3 quarters. Senco’s management is actively working on strategies to mitigate these impacts and achieve its targeted growth in EBITDA and profit after tax. 

Looking ahead to the rest of the fiscal year, Senco is preparing for key festive and wedding seasons, including Teej, Durga Puja, Navratri, Dhanteras/Diwali, and the wedding season. The company anticipates a growth-oriented year, bolstered by favorable market conditions and a focus on innovation and sustainability. 

Additionally, Senco is expanding into the non-jewellery sector through its wholly-owned subsidiary, ‘Sennes Fashion.’ This new venture will explore products such as leather and non-leather accessories, perfumes, and lab-grown diamonds. Senco plans to invest ₹50-60 crore initially, with an annual investment of ₹25-30 crore over the next 4-5 years. The company aims to expand its presence and offerings under the Sennes brand, anticipating that these non-jewellery products will contribute around 5% of total revenue in the coming years. 

Managing Director and CEO, Suvankar Sen, highlighted that while non-jewellery items might have lower ticket sizes, they are expected to offer better gross margins, similar to the diamond jewellery segment. The diversification into lifestyle and fashion products is also expected to help protect margins against competitive pressures in the gold jewellery market. Sen predicts that lab-grown diamond jewellery could make up 3-4% of Senco’s overall business in the near future. 

September has been a strong month for Senco, with sales 15% higher than the first half of last year, reflecting continued strength in the jewellery sector. 

Retail Jeweller India News