P N Gadgil Jewellers Limited Q2 Profit Rises 52.7% to ₹121 Crore

P N Gadgil Jewellers Limited reported Q2 FY27 profit after tax of ₹121.11 crore, up 52.7% year on year. Revenue from operations rose 22.4% to ₹2,666.38 crore for the quarter ended September 30, 2026, while EBITDA increased 57% and the company continued its retail-led store expansion.

What did P N Gadgil Jewellers report for Q2 FY27?

P N Gadgil Jewellers reported a sharp rise in quarterly earnings, supported by higher retail sales and improved operating performance. Profit after tax increased to ₹121.11 crore in Q2 FY27 from ₹79.31 crore in the corresponding quarter of the previous year. Revenue from operations grew to ₹2,666.38 crore from ₹2,177.62 crore.

The company said retail revenue increased 31% year on year to ₹2,061 crore. Same-store sales growth was 25.5%, indicating that growth was not limited to new store additions. Management linked the performance to retail demand and progress in newer markets in northern and central India.

EBITDA rose 57% year on year to ₹224.6 crore, with EBITDA margin expanding by 186 basis points to 8.4%. Adjusted EBITDA increased 60% to ₹209.6 crore, while adjusted EBITDA margin improved to 8.2%. The reported profit after tax margin was 4.5%.

Which financial metrics improved during the quarter?

The main improvement was in profitability, as P N Gadgil Jewellers' 52.7% increase in profit after tax exceeded its 22.4% revenue growth. EBITDA growth of 57% also outpaced sales growth, reflecting operating leverage and changes in the sales mix cited in the earnings discussion.

Gross margin was 12.7%, up 89 basis points year on year. However, it declined 50 basis points sequentially. Management attributed the quarter-on-quarter change to the rise in the franchisee share of business to 17% from 12%, as franchisee sales carry a different cost structure.

The company said the franchise model can protect EBITDA margins because store-level costs such as rentals are borne in the franchisee's profit and loss account. This arrangement can lower reported gross margin at the company level while reducing operating-cost requirements for P N Gadgil Jewellers.

How is P N Gadgil Jewellers expanding its store network?

P N Gadgil Jewellers is targeting about 103 locations by the end of FY27 and plans to open around 23 new stores during the year. Management indicated that eight to 10 openings are expected in Q3, with the remaining planned for Q4. The expansion is being led primarily through the franchise-owned, company-operated, or FOCO, format.

The company is also building its presence outside Maharashtra. Seven company-owned stores in northern and central India were reported to be generating average revenue of about ₹60 crore, compared with the company's earlier projection of ₹50 crore to ₹55 crore. These stores recorded a stud ratio of 17.4% and stock turn of around 1.1 times.

Management said it expects to have eight to 10 stores in Uttar Pradesh by the end of FY27. Made-to-order sales account for 22% to 25% in Uttar Pradesh, compared with about 32% in Maharashtra. P N Gadgil Jewellers has attributed the early performance in the region to market research, local merchandise and brand positioning.

What are the company's revenue and margin targets?

P N Gadgil Jewellers has guided for revenue of ₹13,000 crore or more in the second half of FY27 at the company level. Management also reiterated a profit after tax margin target of 4% to 4.2%. These targets place the festive and wedding-demand period at the centre of the company's second-half performance.

The timing of the festive calendar affected reported Q2 sales. Management said the shift in Navratri moved around ₹200 crore of revenue from Q2 into Q3. This means the quarterly revenue comparison included a calendar effect in addition to underlying retail growth.

Other expenses stood at ₹86 crore in Q2, compared with ₹85 crore in the preceding quarter. The company said advertising and promotional discounts had moderated compared with the prior year, and similar moderation was expected in the second half. No separate guidance was provided for a further reduction in absolute other expenses.

What does the franchise mix mean for investors and operations?

The higher franchisee mix allows P N Gadgil Jewellers to add stores with lower direct capital deployment, according to management. At a franchise store opening, the company makes an outright sale of inventory to the franchisee and subsequently supplies replenishment inventory. Average gold inventory per store was stated at ₹50 crore to ₹55 crore, or about 30 kg to 32 kg depending on karatage.

Management expects the franchise model to support return on capital employed over time, though it also changes the composition of reported margins. The company intends to split future expansion equally between company-owned, company-operated and franchise-owned, company-operated formats from the next financial year. It expects internal accruals to fund company-owned expansion without additional debt.

The company raised ₹700 crore through a qualified institutional placement that was oversubscribed 1.5 times. It also said gold-price volatility is being managed through higher hedge coverage. Inventory turnover was 3.7 times, below the pre-IPO range of five to six times, and management indicated that continuing expansion may keep turnover around current levels.

Conclusion

P N Gadgil Jewellers' Q2 FY27 results showed profit growth ahead of revenue growth, with profit after tax rising 52.7% to ₹121.11 crore and EBITDA margin reaching 8.4%. Retail growth, same-store sales gains and expansion beyond Maharashtra were the principal operational drivers disclosed by the company.

The next major checkpoints are the delivery of ₹13,000 crore or more in second-half revenue, the 4% to 4.2% profit after tax margin target and the planned opening of about 23 stores in FY27. Investors will also be able to assess how the expanding franchise mix affects gross margin, operating costs and inventory turnover.