Senco Gold stock surges 4.5% on robust Q2 business updates; retail growth up 27%
Shares of Senco Gold surged 4.5 percent on October 9 after the company released robust business updates for the July-September period, highlighting strong retail growth in the quarter gone by.
At 09.35 am, shares of Senco Gold were trading at Rs 1,401.25 on the NSE.
The company's retail growth was up 27 percent on year while same-store-sales growth (SSSG) rose 20 percent in Q2 as against 4 percent in Q1. The company attributed its strong growth in Q2 to the consistent increase in gold prices through the quarter, driven by central bank buying, Fed rate cut, geopolitical tensions which led to the emergence of gold as store of value. For the quarter, gold prices were up 5 percent sequentially and 31 percent on year while those of silver rose 3 percent and 30 percent, respectively.
In addition, good monsoon in Eastern India also acted as tailwind for robust growth in tier 3 and tier 4 cities and custom duty reduction in the Union Budget also bolstered pent up demand of Q1, Senco Gold stated in an exchange filing.
The company further added that the high growth momentum till the first fortnight of the quarter was impacted by gold crossing $2680/0z in the international market along with Shraddha period in last week of September.
Going ahead, the company has provided guidance to the launch of 18-20 jewellery showrooms this year, including 10-12 franchise locations, and have already opened 8 showrooms in the first half of FY25.
"Our pipeline of both own and franchise showrooms is robust, positioning us to meet our annual target. We're also on track for 18-20 percent year-on-year revenue growth in FY25, driven by the upcoming festive season of Dhanteras, Diwali, and Durga Puja. Additionally, we are implementing strategic initiatives, introducing new collections, and aiming to increase the studded jewellery ratio to over 12 percent," the company said.
Senco Gold was also added to the MSCI India Domestic Small Cap index after its latest rebalancing which came into effect from August 30.
Meanwhile, the company's board also approved a 1:2 stock split, the first ever since its listing back in July 2023. The record date for the stock split is still to be decided, though the intends to complete the process within three months of securing approval from shareholders.
Additionally, the company's board has also approved raising funds up to Rs 500 crore through a Qualified Institutional Placement (QIP) or through various permissible methods.
Source: https://www.moneycontrol.com/