Senco Gold's Shares Plummet 14% on Lower Margins Despite Strong Revenue Growth
Senco Gold's shares plummeted by over 14% to a four-week low of ₹343 apiece in Wednesday's trade, weighed down by lower margins despite strong revenue growth. The company reported a 67% year-on-year increase in revenue to ₹3,056 crore for the first quarter of FY27, with retail sales rising 50% YoY to ₹2,651.5 crore.
The sharp rise in average gold prices and an increase in customs duty from 6% to 15% impacted gold demand during the quarter. However, Senco Gold maintained momentum through various marketing initiatives, including old-gold exchange schemes and consumer outreach.
The company's EBITDA grew 16% YoY to ₹213 crore, but the EBITDA margin declined by 310 basis points from 10.1% in the same period last year due to heavy discounts. Net profit decreased 3% YoY to ₹101 crore with a PAT margin of 3.3%. Senco Gold expects demand to pick up in the subsequent quarter driven by the monsoon and festive season.
The company's managing director, Suvankar Sen, stated that they remain focused on achieving 20%+ value growth in FY27 while strengthening Brand Senco across the country and pursuing disciplined, profitable pan-India expansion with a focus on East and North India.