/** blogpostTitle: Golkunda’s Q1 FY27: margins improve as domestic capacity comes online blogpostSlug: golkunda-q1 blogpostCoverImageDescription: Ultra-realistic corporate finance cover image showing a clean desk with a laptop displaying a simple financial dashboard: a line chart trending upward for quarterly revenue and a second line for EBITDA margin rising. Beside it, a neat factory floor blueprint and a small metal jewellery mould tool to represent manufacturing expansion. The dashboard includes two bars for Q1 FY26 and Q1 FY27 revenue, and a small gauge for EBITDA margin improvement. Neutral lighting, professional office setting, no logos or readable text. blogpostShortTitle: Golkunda Q1 FY27 margin-led growth */

Golkunda’s Q1 FY27: margins improve as domestic capacity comes online

Golkunda Diamonds and Jewellery Limited used its Q1 FY27 earnings call to do two things at once: report a strong start to the year and explain why the next phase will not be only about exports. The company has been listed since 1992, but this was its first formal earnings call, with management laying out a strategy centred on capacity expansion, domestic market entry, and a larger role for lab-grown diamond jewellery.

Financially, the quarter showed faster improvement in profitability than in topline growth. Revenue from operations rose to INR 85.21 crore in Q1 FY27 from INR 69.44 crore in Q1 FY26, a year-on-year growth of 22.72%. EBITDA increased to INR 8.64 crore from INR 5.10 crore, taking EBITDA margin up to 10.14% from 7.35%. Net profit rose to INR 5.14 crore from INR 3.14 crore, and net profit margin improved to 6.03% from 4.52%.

Management described this margin improvement as encouraging because the intent is not only to grow sales, but also to improve the quality and profitability of operations. The call did not provide a detailed margin bridge, but the reported numbers show that operating leverage and cost discipline played out in the quarter.

A business built on exports, now adding a domestic engine

Golkunda’s core business has been jewellery manufacturing and exports for more than four decades. The company described itself as a manufacturer of fine jewellery across natural diamond jewellery, gold jewellery, gemstone jewellery, jadau, and lab-grown diamond jewellery. Export markets referenced in the presentation and call included the UAE, Saudi Arabia, Kuwait, Bahrain, Qatar, Singapore, Hong Kong, and the USA.

In FY26, exports were referenced at around INR 272 crore in the call and shown as INR 272.20 crore (FOB) in the presentation. The company also positioned itself as a net forex earner, citing FY26 export earnings (FOB) of INR 272.20 crore versus import outgo of INR 67.21 crore.

However, management also acknowledged concentration. In the call, it stated that 85% to 90% of current business is in the Middle East, and that the top 10 customers contribute about 60% to 65% of revenue.

This context matters because the new strategic move is not replacing exports. It is creating a second growth engine in India.

The Andheri manufacturing unit: capacity first, market diversification next

The key operational development is a new domestic manufacturing facility at Andheri (East), Mumbai, described as about 5,360 square feet. Management said it has an estimated capacity of around 125 kg to 150 kg of jewellery per annum, and is expected to increase overall manufacturing capacity by about 50% to 60%.

The reason the facility matters goes beyond capacity. The company’s earlier facilities are in a Special Economic Zone (SEZ), aligned to exports. To serve domestic customers in a meaningful way, management said it had to set up operations outside the SEZ framework.

In the call, management stated the facility is already operational and currently focused on sample lines and retailer pitches. It expects domestic revenue contribution to be limited in the current year, guided at around INR 15 crore to INR 20 crore.

One investor question on the call asked what incremental revenue could be supported by the additional capacity. Management said the answer depends on product mix and caratage (with examples such as retailers shifting from 18 carat to 14 carat, and in some cases to 9 and 10 carat). It also referenced the possibility of lab-grown jewellery in silver over time. Still, it gave a directional estimate that the added capacity could support around INR 250 crore to INR 300 crore of incremental revenue at peak utilisation.

Financial summary

Note: Figures are converted from INR lakhs as presented in the investor presentation.

Lab-grown diamonds: a growth lever, but not without pricing risks

Management repeatedly highlighted lab-grown diamond jewellery as an area that could contribute meaningfully to future growth, especially in India. It linked this to evolving consumer preferences and affordability, particularly among younger buyers.

At the same time, the company’s current mix is still largely natural-diamond driven in its main export markets. Management said lab-grown jewellery is currently less than 5% to 7% of revenue because the Middle East market is not yet very active in lab-grown jewellery. It also said that its major lab-grown revenue comes from the US market.

The presentation provided additional industry context around lab-grown diamonds in India, including volume milestones where lab-grown diamonds overtook natural diamonds by volume in early 2026 and the BIS standard for labelling laboratory-grown diamonds. Importantly, the presentation also highlighted a risk marker: polished lab-grown diamond export value falling 10% year-on-year even as volumes rose, signalling that price deflation can outweigh volume growth.

For investors, the implication is that lab-grown diamonds may expand the addressable market, but unit economics can remain volatile. Execution will depend on product positioning, distribution, and the company’s ability to protect margins as category pricing shifts.

Guidance, capital raising, and what to track next

On the call, management gave a near-term growth expectation and a longer-term mix aspiration:

1. For FY27, management stated it is targeting revenue growth of around 15% to 20%, predominantly driven by exports.
2. It expects domestic sales to be modest in the current year due to the ramp-up phase.
3. It shared an aspiration that by 2030, domestic business could be around 50% of total business.

The company also indicated that it has raised capital through a preferential allotment of convertible warrants to support expansion and working capital. In the call, management referenced the raise as around INR 27 crore and said it would predominantly suffice for domestic expansion working capital needs.

Risk management disclosures in the call were limited but specific. Management described a natural hedge for gold because it imports and exports gold at predominantly the same price, and said it uses forward contracts to hedge diamond receivables for about four to six months based on expected receivables.

The next few quarters will likely be judged less on intent and more on evidence of domestic execution. The measurable milestones mentioned by management include the initial domestic revenue contribution in FY27, the ramp-up trajectory of the Andheri facility, and any formal progress on the B2C launch that management indicated could happen around the Diwali period in the current calendar year.

Golkunda’s Q1 FY27 numbers show improving profitability, and the strategy narrative is clear: strengthen the export core while building a domestic platform that can scale over time. The company has put a new manufacturing base in place. The remaining question is how quickly customer onboarding in India converts from sampling to recurring orders, and whether a future B2C push can add margin without creating execution strain.