Senco Gold surges nearly 10% on robust Q4 business update, nears 52-week high

Shares of Senco Gold rose over 4 percent on April 15 after the company in its business update reported 28 percent revenue growth for FY24 and 39 percent on-year growth for the quarter ended March 2024.

Despite rising gold prices, the company achieved 13 percent volume growth in gold and 19 percent volume growth in diamond for the full fiscal. The rise in yellow metal’s price has impacted unorganised jewellers, but as far as organised listed jewellers are concerned, they have grown, Senco Gold said.

Gold price rise has led to a squeeze in the working capital availability due to higher margins for Gold Hedging and Gold Metal Loan (GML), Senco said.

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According to the business update, the old gold exchange as a percentage of Senco Gold’s sales increased to 32 percent from 29 percent last year. Its same-store-sales growth (SSSG) during the full year stood at 19 percent.

The jewellery retail major recently said that the recent sharp spurt in gold prices due to geopolitical tensions escalating in the Middle East has dampened demand, and the industry’s first-quarter performance hinges upon ongoing buying propensity during festive and auspicious New Year celebrations.

The Kolkata-based company said it has taken a slew of measures to combat the demand situation with a push toward diamond-studded gold jewellery and consumer-centric schemes.

However, these may not compensate for the 15-20 percent de-growth in volume terms witnessed in March and April.

In FY24, Senco launched 23 showrooms on a net basis, including 4 showrooms in the January-March quarter, taking the total showroom portfolio to 159, the highest-ever expansion since its inception.

Also Read | Asia stocks slide, gold rises as Middle East conflict sparks safety rush

Senco Gold made its stock market debut last year. The company’s Initial Public Offering (IPO) happened in July 2023 at an issue price of Rs 317. The stocklisted on BSE and NSE at a strong premium of more than 35 percent at Rs 430 on NSE.

Since then the share price has more than doubled. At 9:37 am, Senco Gold shares were trading at Rs 880.00, up nearly 10 percent from the previous close.

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