Senco Gold Aims for 20-25% Revenue Growth in FY27 Amid Margin Normalization
Senco Gold targets 20–25% revenue growth in FY27 but cautions PAT margins will normalise to 4–4.5%
Image: The Economic Times
Senco Gold targets a revenue growth of 20-25% for FY27, while anticipating a normalization of profit after tax (PAT) margins to 4-4.5% from FY26's high of 6.8%. The company faces a recent demand slowdown but expects recovery with the upcoming wedding season.
- 01Senco Gold's PAT margin is expected to normalize to 4-4.5% for FY27, down from 6.8% in FY26.
- 02A recent slowdown in demand is attributed to the Adhik Mass period and a gold import duty hike.
- 03The company has a ₹5,500 crore inventory, with 50-60% hedged against gold price volatility.
- 04Senco aims to increase diamond jewellery sales from 10-11% to 14-15% of total revenue in the next 2-3 years.
- 05Expansion plans include opening over 20 new stores annually, focusing on eastern and northern India.
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Senco Gold's Managing Director and CEO, Suvankar Sen, outlined the company's conservative outlook for FY27, projecting a revenue growth of 20-25% while expecting profit after tax (PAT) margins to normalize to 4-4.5% from the elevated 6.8% achieved in FY26. This adjustment follows a strong performance driven by rising gold prices and inventory gains. However, recent demand has dipped due to the Adhik Mass inauspicious period and increased gold import duties. Sen anticipates a recovery in demand during the June-July wedding season. The company is focused on enhancing its diamond jewellery sales, currently at 10-11% of total revenue, with a goal of reaching 14-15% in the medium term. Senco's inventory stands at approximately ₹5,500 crore, with a significant portion hedged against price fluctuations. The company plans to continue its expansion, targeting over 20 new stores annually, primarily in eastern India, while cautiously eyeing northern and central markets.
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The company's revenue growth and margin normalization could affect local employment and consumer spending in the gold market.
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