Shanti Gold International Ltd Q2 Revenue Rises 73% to ₹746 Crore

Shanti Gold International Ltd reported Q2 FY27 revenue from operations of ₹745.95 crore, up 73.4% year on year from ₹430.08 crore, supported by a 25.4% rise in volumes to 535.5 kg and expanded manufacturing capacity. Management retained its FY27 revenue guidance of ₹3,200-3,500 crore despite lower profitability margins and continued working-capital requirements.

What drove Shanti Gold International Ltd's Q2 revenue growth?

Shanti Gold International Ltd attributed its Q2 FY27 revenue growth to customer additions, deeper business with existing retail partners, a wider product portfolio and added manufacturing capacity. Revenue from operations stood at ₹745.95 crore in the July-September 2026 quarter, compared with ₹430.08 crore in Q2 FY26. The company reported that volumes increased 25.4% year on year to 535.5 kg.

For the first half of FY27, revenue from operations reached ₹1,462.3 crore, against ₹722.9 crore in H1 FY26. This represented growth of 102.3%. H1 volume growth was 41%, according to management, indicating that growth was supported by higher sales volumes rather than only changes in gold prices.

Management said the extended manufacturing facility at Marol had commenced operations and provided greater capacity and operating flexibility. The company linked the expansion to its ability to serve demand from retail partners. It also cited a gradual formalisation of the jewellery industry and a preference for organised manufacturers as supportive factors.

The company said its strategy remains focused on gaining market share, rather than maximising short-term margins. This approach is relevant because product expansion, manufacturing additions and customer acquisition can require upfront spending while the business scales.

Why did profitability and margins moderate in Q2 FY27?

Management said EBITDA margin moderated to 10.2% in Q2 FY27 from 13.3% in Q2 FY26, reflecting changes in product mix and upfront costs related to new business verticals and capacity expansion. It has guided for a sustainable EBITDA margin range of 5% to 7% as its mix evolves.

The company reported Q2 EBITDA of ₹42.52 crore, up 15.6% from ₹36.79 crore a year earlier. This growth was materially lower than the rise in revenue, underlining the margin pressure highlighted during the call. Profit after tax for the quarter was reported at ₹29.6 crore.

The chief financial officer said gold-price movements do not affect the company's core gold margins because inventory gains are not treated as core earnings. Management described the current moderation as transitional and said higher facility utilisation could support margins over time. No specific timeline for such improvement was provided.

How is Shanti Gold funding its expansion plans?

Shanti Gold said it raised approximately ₹99.83 crore through a rights issue during H1 FY27 to support working-capital requirements and expansion. Management also said that the jewellery manufacturing business is inherently working-capital intensive, particularly when inventory is being built to support a larger scale of operations.

The company acknowledged increased short-term borrowings alongside equity raising. Higher inventory and borrowings can place pressure on cash flows even when revenue is expanding rapidly. The call did not provide a detailed working-capital cycle or a target for debt reduction.

Management also clarified that an investment discussed during the call was intended for treasury management and short-term return optimisation, rather than a strategic diversification away from the jewellery business. This distinction indicates that the core operating focus remains manufacturing and supplying gold jewellery to retail partners.

What is the status of the Jaipur facility and export business?

The Jaipur facility is expected to commence commercial operations in January or February 2027, later than previously indicated. The three-acre site includes a 65,000-square-foot building, which management said is ready, with interior work remaining before operations begin.

The facility is intended to manufacture machine-made plain gold jewellery and strengthen Shanti Gold's presence in North India. Its start-up is an operational milestone because it is designed to add a new product capability as well as regional manufacturing capacity. However, the revised timing means its contribution was not part of Q2 FY27 operations.

Exports remain a relatively small part of the business, contributing about 6% to 7% of revenue. The Dubai office was not yet operational at the time of the call, and management said geopolitical issues had affected timelines. The company did not give a revised launch date for the office or a specific export-revenue target.

What does management's FY27 guidance mean for investors?

Management maintained FY27 revenue guidance of ₹3,200 crore to ₹3,500 crore, which it said implies about 60% growth over FY26. It also retained volume-growth guidance of 25% to 30%, citing historical volume CAGR of 44% as part of its confidence in the outlook.

The company said it remained comfortable with the revenue range even if gold prices declined from ₹1,50,000 to ₹1,40,000 per 10 grams. Since volumes, capacity utilisation, retail-partner demand and working-capital funding are central to the plan, those measures remain important alongside reported revenue.

For investors, the quarter presents a mixed operating picture. Top-line and volume growth were strong, while margin guidance was lower and working-capital intensity remained elevated. The delayed Jaipur commissioning and the still-pending Dubai office are also relevant execution points for the second half.

Conclusion

Shanti Gold International Ltd delivered substantial Q2 and H1 FY27 revenue growth through higher volumes, retail-partner demand and expanded capacity at Marol. The results also showed that the company is pursuing scale while accepting lower near-term margins and maintaining significant inventory and funding requirements.

The next disclosed operational milestone is the expected January-February 2027 start of the Jaipur facility. Investors will also watch progress on the Dubai office, the pace of volume growth, working-capital funding and whether FY27 revenue remains on track for the ₹3,200-3,500 crore guidance range.