Kalyan Jewellers India Ltd Management Discussions

ECONOMIC REVIEW Global Economy

According to the April 2026 World Economic Outlook (WEO) bylMF.theglobaleconomyisnavigatinga period of significant recalibration amid renewed geopolitical shocks. Global growth is projected to slow from 3.4% in 2025 to 3.1% in 2026 and reach 3.2% in 2027. While these levels remain below historical averages as global activity and disinflation efforts adapt to earlier pressures in the Middle East, which are now showing signs of easing, the broader outlook remains adaptive.

This transitional phase reflects a cautious investment climate and recent volatility in energy markets, where oil prices have been fluctuating near the USD 105 mark following maritime navigation disruptions. On a positive note, labour markets have shown notable resilience, even as overall growth levels sit below the historical average of 3.7% recorded between 2000 and 2019. Simultaneously, global headline inflation is expected to reach 4.4% in 2026 before declining to 3.7% in 2027, as price-stabilisation efforts continue to guide the global economy toward steady footing.

World Economic Outlook

2024 2025 2026(P)

Projections (GDP Growth)

In 2025, the global economy demonstrated resilience desP1te a shifting trade environment. However, by 2026, the market faced testing from intensified geopolitical tensions and infrastructure disruptions. For jewellery retailers, these macro shifts demanded constant operational balancing, as international gold prices grew highly volatile and put pressure on the I NR, directly impacting the domestic supply chain.

Gold increasingly solidified its safe-haven status, climbing 44.4% to historic highs exceeding USD 5,000 per ounce on central bank purchases and dollar concerns, before a stronger dollar and rising interest rate expectations triggered a recent price correction. For retail operations, such volatility presented distinct structural hurdles. Discretionary demand for gifting and fashion items frequently paused as cautious consumers deferred purchases until pricing stabilised. These dynamics pushed demand for gold to record highs alongside robust central bank purchases, reinforcing the Indian belief in gold as a bankable asset class.

Retailers must maintain high inventory agility to meet diverse demand across various ticket sizes and carat preferences. Maintaining a robust presence of SKUs within high-traction price bands tailored to specific micro-markets is essential. Success depends on offering flexibility in design and grammage, combined with transparent pricing, to manage customer expectations. Ultimately, agile and nimble jewellery retailers fared exceptionally well amidst these challenges, heavily aided by the continuing shift of customers from the unorganised sector.

Outlook

Moving forward, the global economic trajectory is set for a modest recalibration, with growth expected to settle at 3.1% through 2026 before tracking towards 3.2% in 2027. Although a gradual cooling of inflation has prompted central banks to initiate tentative interest rate cuts, the momentum remains capped by a highly cautious pace of monetary easing and prolonged geopolitical friction in the Middle East.

For the jewellery industry in FY27, domestic demand remains driven by consumer disposable income and near-term budgets. However, maintaining operational agility, especially the right showroom inventory mix during sharp gold price surges, is critical. To adapt, leading jewellers are investing in brand trust while offering innovative, lightweight designs tailored to evolving customer preferences. This environment underscores the necessity of high operational flexibility to navigate price volatility. Leading jewellers are responding by continuing to invest in their brands to build trust, while offering innovative designs and lightweight options that align with evolving customer preferences.

Indian Economy

Against a turbulent global backdrop, India continued to stand out as a highly resilient market, sustaining its upward growth trajectory. This economic robustness was anchored by a substantial 14.5% boost in government caP1tal expenditure alongside steady private consumption, driving real GDP expansion to a solid 7.7% leading into the fiscal period. An initial half- year surge of 8% further demonstrated the countrys structural stability, even as international geopolitical pressures mounted.

Domestic inflation stayed broadly aligned with the Reserve Bank of Indias (RBI) comfort zone. Easing food costshelped pull headlineCP1 inflation to a comfortable average of 1.7% between April and December 2025, though the central bank maintains a vigilant full-year projection of 4.6% moving forward. Meanwhile, core inflation experienced gentle upward pressure, heavily driven by the soaring cost of precious metals.

DesP1te the encouraging macroeconomic backdrop, some challenges persist, such as food price volatility and potential heatwaves. Additionally, the Indian rupee faced downward pressure by April 2026 due to global risk aversion and rising crude oil prices, impacting the landed cost of imported gold. While these inflationary pressures led some consumers to seek lighter-weight P1eces within fixed budgets, larger organised jewellers successfully caP1talised on this shift. By collaborating with advanced manufacturers and investing in the latest design technology, they optimised the gold content through innovative, lightweight designs, effectively capturing demand even within price- sensitive market segments.

Outlook

India continues to outpace other major emerging markets, maintaining its position as a primary engine of global economic growth. The IMF confirms that the country remains on a definitive trajectory to become the worlds third-largest economy by 2027. This sustained medium-term expansion is anchored by deep structural P1llars, including a highly favourable demographic profile, accelerating economic formalisation, a world-class digital infrastructure network, and continuous public caP1tal expenditure.

For FY26, Indias real GDP growth is estimated at a resilient 7.7%, describing the economic momentum as evenly balanced and robust. This performance is heavily underP1nned bythriving urban consumption,a steady revival in private investment, and exceptionally vibrant services sector activity. The governments ongoing commitment to fiscal discipline, aggressive infrastructure development, and structural reforms to ease business operations is creating a highly supportive ecosystem forconsumer-facing industries, particularly the organised jewellery retail sector.

The Indian Jewellery Industry Overview

The Indian jewellery market sustained strong growth through FY26, propelled by rising disposable incomes, evolving consumer asP1rations, and golds timeless dual role as a cherished adornment and a dependable financial asset. Deeply rooted in cultural heritage, the industry continues to be anchored by resilient, non- discretionary wedding and festive demand.

During FY26, the sector achieved significant top-line expansion in value terms. Crucially, organised retailers grew at a much faster pace, steadily capturing market share from the unorganised sector. This formalisation shift is driven by growing consumer insistence on certified purity, mandatory hallmarking, transparent pricing, and established brand trust. While traditional motifs command ceremonial purchases, demand for contemporary, lightweight and diamond-studded collections is raP1dly expanding among younger demographics. Blending physical showroom networks with digital touch points through modern omnichannel models, organised leaders remain uniquely positioned to capture long-term momentum.

The India jewellery market size was valued at USD 95.10 Billion in 2025 and is projected to reach USD 151.37 Billion by 2034, growing ata compound annual growth rate of 5.30% from 2026-2034. This sustained growth is propelled by rising disposable incomes, raP1d urbanisation, and a strong consumer preference for certified, high-caratage offerings. Fine jewellery, dominated by traditional gold and precious stone ornaments, continues to capture over 80% of the total domestic market share.

The Indian market is undergoing a structural transition toward branded chains, mandatory hallmark compliance, and omnichannel formats. Unlike western markets that are heavily fashion-driven, the Indian industry remains deeply distinct, anchored in cultural traditionswherewedding and bridal demand accounts for more than 60% of total annual purchases. Indian consumers consistently prioritise purity, transparency, and heritage over fast-fashion trends, seamlessly blending digital discovery with physical, trust-led buying experiences across expanding metro and nonmetro markets alike.

THE INDIAN COLD MARKET OVERVIEW Overview

Indias profound cultural and emotional affinity with gold remains deeply woven into its social fabric, with the metal serving as both a vital personal adornment and a core financial asset. It continues to play a multifaceted role as a long-term store of wealth, a dependable hedge against inflation, and critical collateral for secured loans, cementing its position within the countrys economic and social systems. As of 2026, India maintains its status as the second- largest consumerof gold globallyand holdsoneofthe largest gold reserves, valued at approximately USD 131.63 Billion.

The market has adapted to shifting consumer behaviours, with everyday wear increasingly favouring lightweight, minimalist, and fusion designs, while traditional motifs continue to dominate for weddings and major festivals. Seasonal demand is consistently anchored by ausP1cious occasions such as Akshaya Tritiya, Dhanteras, Durga Puja, and Karva Chauth. Notably, bridal jewellery persists as the markets primary P1llar, representing roughly 60% of total annual demand.

DesP1te record-high bullion prices in early 2026, this segment has demonstrated remarkable resilience across both urban and rural markets, sustained by expanding middle-class prosperity, wider digital accessibility, and a robust, well-established gold- exchange culture.

An Evolving Market

The jewellery retail sector in India is undergoing a profound structural shift, propelled by raP1d formalisation, heightened brand consciousness, and a move toward conscious consumption. What was previously a fragmented and largely unorganised market has consolidated into five distinct operational formats.

National brands continue to lead through extensive networks and standardised trust. Regional strongholds maintain deep community ties by tailoring designs to local heritage and specific community motifs. A high-growth third segment consists of omnichannel specialists that leverage technology and Al to offer lightweight, design-centric accessible luxury for digitally-native Millennial and Gen Z buyers. The fourth format features premium experiential boutiques that provide high-end Indian couture and an elevated, service-led shopP1ng environment. Finally, international luxury houses have established a growing presence in major metros, catering to affluent consumers seeking global craftsmanship and exclusive aesthetics. This maturation has turned the market toward participation and self-expression, with organised players gaining significant market share through transparent pricing and mandatory hallmarking compliance.

Our Strategic Response

In response to these market dynamics, Kalyan Jewellers is building a future-ready, multi-brand platform to serve each emerging segment, having expanded our footprint to 507 showrooms globally as of 31 March 2026. Our flagship Kalyan brand anchors our national footprint through trust and transparency, scaling to 342 showrooms in India, including 222 FOCO (Franchise Owned Company Operated) formats, by the end of the financial year. To deepen local connections, we have launched a new regional brand offering exclusively localised designs crafted to reflect regional traditions, with initial dedicated showrooms set to open in August 2026. Concurrently, our digital-first Candere platform successfully captures the lifestyle and youth-driven market, scaling its networkto 124 showrooms across India through a strategic mix of 70 FOCO and 54 COCO formats as of 31 March 2026. Together, these established initiatives position us to lead across all key customer segments in a raP1dly formalising market.

India Jewellery Market Forecast, 2025-2034 (USD Billion) (Size, By Product)

While gold prices reached historic highs in FY26, consumer demand demonstrated remarkable resilience, particularly during the critical wedding and festive periods. Organised retailers continued to outpace the unorganised sector, as transparency and brand trust became the primary drivers for high-value transactions.

Cold prices in India followed a steep upward trajectory, with 24K gold reaching an average of Rs.1,23,000 per 10 grams in 2025 and surging to a record average of Rs.1,53,150 by April 2026. This rally was fuelled by intense geopolitical tensions in the Middle East, persistent global inflation, and aggressive gold accumulation by central banks. South India maintained its lead, accounting for nearly 40% of national demand. Domestic consumption is expected to remain robust, underP1nned by theinelastic nature of Indiaswedding economy and rising urban wealth.

India is the worlds second-largest gold jewellery consumer and is witnessing a structural transformation. Younger, digitally-native consumers are prioritising omnichannel accessibility and superior retail experiences over traditional price-centric models. Simultaneously, older demographics are increasingly converting to organised brands to ensure quality and resale security.

Furthermore, regulatory tailwinds such as mandatory hallmarking continue to reshape the industry landscape. These initiatives are accelerating market formalisation and reinforcing the clear competitive advantage of established, organised leaders like Kalyan Jewellers.

Key Growth Driver

The appetite for jewellery in India is profoundly seasonal and rooted in cultural traditions, with demand primarily peaking during the wedding calendar, major festivals, and rural harvest cycles. These consumption surgesexhibitsignificant regional diversity,dictated by localised customs and varying income patterns, which creates a highly complex and multifaceted market.

The Hyperlocal Approach

Indias jewellery preferences remain deeply regional, with each zone reflecting distinct design aesthetics, budget expectations, and purchase behaviours. Consequently, the most effective growth strategy is a hyperlocal approach that blends a strong community presence with the scale and trust ofa national brand.

In the South, gold continues to dominate, with the region accounting for nearly 40% of national demand. The West (25%) and North (20%) offer a balance of traditional and modern styles, including a significant rise in demand for diamond-studded and lightweight everyday wear. The East (15%) demonstrates strong demand for cultural designs and intricate craftsmanship.

Dominance of South India in the Indian Jewellery Market

Such market fragmentation historically hindered local jewellers from scaling past their regional strongholds. Achieving a national footprint now demands a sophisticated blend of region-specific productcuration, localised marketing, community-level engagement, and a highly responsive supply chain.

By implementing this model and leveraging data- driven consumer insights alongside massive operational scale, organised retailers are exceptionally equipped to capture Indias immensejewellery demand across both metropolitan and rural landscapes.

OUR RESPONSE

Our deeply rooted hyperlocal approach allows Kalyan Jewellers to cultivate genuine relationships with Indias highly diverse customer base. We execute state- and city-specific campaigns featuring local brand ambassadors and regional influencers, ensuring communication in local languages. To offer culturally relevant portfolios, our 15 procurement centressourcedirectlyfrom local artisansacross major manufacturing hubs. Showrooms are intentionally staffed with local talent who understand regional sensibilities, while our grassroots ‘My Kalyan network, comprising 1,139 centres and 4,375 dedicated personnel, drives deep, door-to-door customer outreach acrossurban,semi-urban,and rural markets. This comprehensive, localised integration ultimately solidifies our standing as the nations premier, community-focused jewellery partner.

Our ability to execute this hyperlocal strategy at scale relies heavily on a highly responsive supply chain infrastructure. By positioning 15 procurement centres across Indias premier jewellery manufacturing hubs, we achieve efficient sourcing of region-specific collections and an unhindered flow of stock to our retail network. This decentralised operational model is reinforced by an advanced Enterprise Resource Planning (ERP) platform that grants us real-time inventory visibility across all showrooms. Utilising unique item-level barcodes, this system minimises lead times and empowers us to dynamically reallocate or top up inventory during high-demand festive and wedding periods. Ultimately, integrating our logistics with shifting seasonal purchase habits ensures we stay perfectly aligned with evolving customer tastes across every micro-market.

Omnichannel Retail Transforms Jewellery Market

Omnichannel retail is reshaP1ng the jewellery landscape in India, expanding accessibility and redefining consumer behaviour. With the rise of digital adoption reaching 12% market share by 2026, brandsare leveraging online platformsto reach newer audiences. This is especially true for convenience- driven buyers, where 73% of purchase journeys now begin online before often being completed in-store, driving significant innovation and competition across the sector.

Our Response

At Kalyan Jewellers, we continue to enhance our digital and operational capabilities to maintain an industry-leading position in a transforming retail space. Our omnichannel strategy is anchored by our digital-first platform, Candere, which serves the lifestyle and youth-driven segments. Propelled by exceptionally strong same-store sales growth and aggressive expansion, Candere achieved an outstanding turnaround in FY26, recording Rs.4,253 million in revenue and reaching net profitability (PAT positive) in the second half of the fiscal year. Expanding our digital touchpoints further, we are launching dedicated e-commerce platforms for both our flagship Kalyan brand and our new regional brand. This comprehensive online presence, integrated with our physical retail footprint, positions our multi-brand platform to deliver a seamless, modern shopP1ng experience across every customer segment.

Indias Jewellery Market Formalises

Across Indias consumer landscape, there is a visible shift toward organised and branded offerings, a phenomenon clearly evident in categories like apparel, footwear, and consumertech.This evolving mindset is particularly pronounced in the jewellery sector, where buying decisions are increasingly driven by brand trust, asP1rational value, transparency, hallmark certification, and official billing. While unorganised retailers continue to hold a significant market presence across smaller urban centres and rural areas, ongoing formalisation initiatives are consistently expanding the footprint and long-term advantage of organised retail leaders.

Accelerating Market Formalisation: The Rise of Organised Retail

Our Response

Asa P1oneer in Indiasorganisedjewelleryspace, Kalyan Jewellers has systematically built the Kalyan brand into an asP1rational symbol of trust, transparency, and quality over decades. Long before formal mandates, we institutionalised industry standards through BIS hallmarking and upfront pricing transparency. Today, the immense equity and pull of the Kalyan brand pay strong dividends. Combining hyper local insights with a mature procurement network enables faster design turnover and market execution. Crucially, long-standing manufacturer relationships allow us to deliver intricate, high-aesthetic designs, including lightweight collections that reduce gold content without compromising visual impact. Backed by rigorous internal controls, uniform staff training, and a footprint of 466 showrooms across India as of 31 March 2026, we continue to lead the shift from unorganised trade.

Focus on Rural/Semi-Urban Markets

Rural and semi-urban India account for over 60% of the countrys gold jewellery demand, driven by deep- rooted cultural traditions and rising incomes. However, organised retail penetration in these markets remains limited due to infrastructure and cost challenges, leaving significant headroom for growth.

Cold Jewellery Demand and Ownership is Higher in Rural India and Rises with Income Levels

Our Response

Kalyan Jewellers continues to strategically expand its presence across non-metro landscapes, with nonmetro markets comprising 73% of our standalone Indian showroom network as of 31 March 2026. This deep penetration into high-growth markets is powered by our unique grassroots My Kalyan network. Operating through 1,139 centres and 4,375 dedicated personnel focused on lead generation, customer outreach, and doorstep engagement without holding retail inventory, this format effectively addresses latent demand where organised retail penetration has historically been low. Furthermore, to solidify our connection with value-conscious consumers, we are preparing to launch a new regional brand in FY27. This format will exclusively offer affordable, community-specific staple jewellery crafted to mirror local traditions and regional heritage, positioning us to unlock the immense long-term potential of rural and semi- urban India.

Performance in FY26

FY26 stood out as a remarkable period for Indias organised jewellery retail sector, navigating external head winds likeglobal macroeconomicshiftsand sharp gold price volatility, which recorded a 60% to 70% sP1ke during theyear. Growth was sustained by robust consumer demand during key wedding and festive intervals, alongside raP1d structural formalisation and expanding footprints across Tier 2, Tier 3, and rural landscapes.

Organised retailers effectively leveraged their brand equity, expanding omnichannel models, and evolving regulatory frameworks to capture significant market share and drive top-line expansion. The broader industry recorded high footfalls and healthy revenue growth during milestone events like Akshaya Tritiya, Dhanteras, and traditional wedding quarters. To offset the impact of soaring gold rates on customer volume, businesses dynamically P1voted towards higher- margin studded lines, lower-caratage everyday P1eces, and lightweight designs designed to match fixed consumer budgets.

Our Response

At Kalyan Jewellers, FY26 marked a milestone year of accelerated expansion and unprecedented financial strength under our caP1tal-light model. We aggressively scaled our network by launching 129 showrooms across Kalyan and Candere formats, expanding our footprint further into international territory with our first showroom in the United Kingdom and taking our global showroom count to 507. Our unwavering focus on caP1tal-efficient growth, hyperlocal design customisation, and technology- driven operations allowed us to cross a historic milestone, delivering Rs.3,57,429 million in consolidated revenue and achieving a net profit (PAT) of Rs.13,504 million. Backed by robust free cash flows used to raP1dly deleverage our balance sheet and consistently reward our shareholders, we enter the next fiscal year fully caP1talised to solidify our evolution into Indias premier multi-brand jewellery platform.

COMPANY OVERVIEW

Established in 1993 by Mr. T.S. Kalyanaraman, Kalyan Jewellers has evolved into one of Indias premier and most respected jewellery brands. Grounded in corporate integrity, family legacy, and extensive sector expertise, Kalyan remains a P1oneer of transparent, consumer-first retail practices. Commanding a ~7% share of the nations organised jewellery segment, we provide an exhaustive product suite, comprising gold, diamond-studded, and premium precious lines, tailored across varying price points, occasions, and design preferences. Our multi-brand retail ecosystem extends across India, the Middle East, the United States, and the United Kingdom, encompassing an international network of 507 showrooms backed by profound regional insights as of 31 March 2026.

Central to our commercial success is a highly targeted hyperlocal operating model. Every operational P1llar, ranging from merchandise curation and regional marketing to showroom recruitment and client engagement is calibrated to match local cultural nuances. This deep regional alignment is fortified by 15 procurement centres strategically placed across primary manufacturing hubs, ensuring ourshowrooms resonate seamlessly with the distinct communities they anchor.

By masterfully integrating corporate scale with micromarket customisation, Kalyan Jewellers consistently achieves excellence in craftsmanship, service delivery, and structural design. Powered by caP1tal-efficient expansion strategies and driven on the ground by our extensive 1,139-centre My Kalyan outreach network, we continue our focused mission of generating sustainable, multi-generational value for both our patrons and investors.

Operational Performance

Kalyan Jewellers delivered a strong operational performance in FY26, driven by sustained growth in footfalls, showroom expansion, and enhanced profitability across geographies. The Company continued to execute on its strategy of expanding its physical footprint, deepening its digital presence, and improving caP1tal efficiency leading to higher return ratios and market share gains.

In India, standalone revenue grew from Rs.2,16,386 million in FY25 to Rs.3,10,271 million in FY26, reflecting robust consumer demand across both metro and non-metro markets. This growth was supported by a continued focus on localised offerings and strategic marketing during key demand occasions such as weddings and festivals.

Consolidated EBITDA increased to Rs.24,912 million in FY26,comparedto Rs.l5,172 million in FY25,supported by scale efficiencies and improved margins. Profit after tax (PAT) stood at Rs.13,504 million, as compared to Rs.7,142 million in the previousyear.

The Company also continued its strong momentum in physical expansion. As of 31 March 2026, Kalyan Jewellers operated:

• 342 Kalyan showrooms in India

• 38 showrooms in the Middle East

• 2 showrooms in the United States

• 1 showroom in United Kingdom

In addition, the Candere brand continued to scale its omni-channel presence. As of FY26-end, Candere had 124 showrooms (up from 73 in FY25), comprising a mix of FOCO and COCO models. This raP1d expansion was supported by a sharpened merchandising strategy and ongoing investments in brand building. Candere recorded Rs.4,253 million in revenue for FY26 and turned PAT positive starting from the second half of FY26.

This expansion strategy both in physical stores and digital integration has strengthened Kalyans operational agility and widened its customer base, positioning the brand for continued growth across all markets.

FINANCIAL PERFORMANCE

Summary of Consolidated Profit and Loss

Particulars	FY26	FY25	Change p? Mn)	Change (%)
Revenue	3,57,429	2,50,451	1,06,978	43%
Gross Profit	47,043	32,843	14,200	43%
Gross Profit Margin %	13.2%	13.1%	0.1%
Total Operational Expenses	22,131	17,671	4,460	25%
Advertisement and Promotion Expenses	5,811	4,734	1,077	23%
Other Operational Expenses	16,320	12,937	3,383	26%
EBITDA	24,912	15,172	9,740	64%
EBITDA Margin (%)	7.0%	6.1%	0.9%
Depreciation	4,229	3,427	802	23%
EBIT	20,683	11,745	8,938	76%
EBIT Margin (%)	5.8%	4.7%	1.1%
Finance Costs	4,329	3,595	734	20%
Other Income	2,080	1,446	634	44%
Profit before exceptional items and tax	18,435	9,596	8,839	92%
Profit before exceptional items and tax %	5.2%	3.8%	1.4%
Exceptional items1	415	-	-	0%
PBT	18,020	9,596	8,424	88%
PBT Margin (%)	5.0%	3.8%	1.2%
Profit After Tax (PAT)	13,504	7,142	6,362	89%
PAT Margin (%)	3.8%	2.9%	0.9%

Note:

1. One-time exceptional impact recognised in the current period due to changes in employee benefit provisions arising from the New Labour Codes

Liabilities

Particulars	FY26	FY25
Equity Share CaP1tal	10,327	10,314
Other Equity	52,760	37,721
Non-current Liabilities	18,402	15,117
Current Liabilities	1,25,677	88,107
Total	2,07,166	1,51,259

Assets

Particulars	FY26	FY25
Non-current assets	43,859	37,266
Current Assets	1,63,307	1,13,993
Total	2,07,166	1,51,259

Key Ratios

Particulars	FY26	FY25
Inventory Turnover (Times)	3.00	2.42
Interest Coverage Ratio (Times)	5.76	4.22
Current Ratio (Times)	1.30	1.29
Net Debt to Equity Ratio (Times)	0.50	0.47
RoE (%)	24.30	15.90
RoCE (%)	28.80	19.80

Cross profit margin = Cross profit/Revenue from operations

EBITDA Margin = Earnings before interest, tax, depreciation and amortisation (EBITDA)/Revenuefrom operations EBIT Margin = Earnings before interest and tax (EBIT)/Revenue from operations Profit before tax margin = Profit before tax (PBT)/Revenue from operations Profit aftertax margin = Profit aftertax (PAT)/Revenue from operations

Inventory turnover = (Purchases of stock-in-trade + Cost of materials consumed + Changes in inventories of finished goods and work-in progress)/Average Inventory

Interest coverage ratio = Earnings before interest, tax, depreciation and amortisation (EBITDA)/Finance cost

Current ratio = Current Assets/Current Liabilities

Net debt to equity ratio = Net Debt (including GML)/Total Equity

Return on equity = Net Profit after tax/Average Total Equity

Return on caP1tal employed = Earnings before Interest and tax (EBIT)/(Total Equity + non-current liabilities).

SWOT ANALYSIS Strengths

1. Strong Brand Recognition

Kalyan Jewellers is a trusted national brand with a deep history of trust and quality. Our unique strength lies in combining nationwide appeal with a sharp sensitivity to hyperlocal tastes and regional sensibilities, building lasting customer loyalty across India.

2. Diverse Product Portfolio

Our collections range from grand, traditional wed d i n g sets to sty I is h, I i g h twei g h t eve ryd ay wea r. This variety ensures we have something for every taste, occasion, and budget.

3. Hyperlocal Marketing Strategy

By using both national stars and regional celebrities in our state and city-level campaigns, we build a stronger and more personal connection with local customers.

4. Extensive Retail Network

By operating in major metros, smaller cities, and rural markets, our large network of showrooms makes our brand easily reachable and accessible to customers across the country.

5. Integrated Digital Ecosystem

Our digital platform. Candere.com. works together with its physical showrooms to offer an omnichannel experience. This means customers can easily switch between shopP1ng online and visiting us in-person, making their experience smooth, convenient, and consistent.

6. Strong Governance

Our Board is made up of a diverse and experienced group of leaders, guided by an Independent Chairman. They ensure the company follows strong ethical standards, provides clear direction, and focuses on building lasting value for the future.

7. High Penetration Potential in Rural Areas

While establishing traditional physical showrooms in remote regions presents industry-wide challenges, our MyKalyan network serves as a distinct competitive strength. It allows us to navigate the complexities of deep rural expansion and reach the hinterland much more efficiently than other brands, establishing a robust presence where others find it difficult to manage.

Weaknesses

1. High Dependence on the Indian Market

A large portion of Kalyan Jewellers income comes from the Indian market. This means the business can be affected by changes in Indias economy, new government rules, and shifts in gold prices.

2. Inventory-Intensive Business Model

While jewellery retail requires heavy inventory investment that can constrain caP1tal, Kalyan Jewellers mitigates this through our asset-light FOCO (Franchise Owned Company Operated) model. Franchise partners fund store setup and inventory while we retain operational and brand control, optimising our balance sheet. Reflecting this transition, all of our recent fresh showroom additions follow the FOCO framework, accelerating expansion with maximum caP1tal efficiency.

3. E-commerce Still Scaling

While Candere has improved our brands digital presence, our online sales are still in the early stages of growth. Currently, they contribute a smaller portion of our total income compared to our physical showrooms.

Opportunities

1. Rising Shift to Organised Retail

Driven by increasing demand for certified quality, transparent pricing, and trusted shopP1ng experiences, the Indian jewellery sector is undergoing raP1d formalisation. With a vast overall addressable market, Kalyan Jewellers currently holds a 3% share of the total market and an 8% shareoftheorganised segment. Asa premier PAN- India brand built on decadal consumer trust, this ongoing shift toward organised retail represents our largest strategic growth opportunity.

2. Growth in Online and Omni-channel Sales

The trend toward digital shopP1ng allows us to improve our omnichannel approach. By combining the trust of our physical showrooms with the ease ofonlineshopP1ng through platformslikeCandere, we offer customers the best of both worlds.

3. Category Diversification

By offering more lightweight jewellery, everyday wear, and personalised P1eces, we can attract new types of customers and encourage them to shop with us more often.

4. Expansion in Rural and Semi-Urban Markets

Higher incomes and growing ambitions in Tier 2, Tier 3, and rural India offer great opportunities for growth. We can reach more customers in these areas by expanding our presence and offering products tailored to their specific tastes.

5. International Market Expansion

Opening stores in new countries especially those with large Indian communities, gives us a chance to grow our income and rely less on the Indian market alone.

6. Resilient Revenue Drivers:

Cold Exchange Mechanisms

Exchanging old gold for newjewellery accounts for nearly one-third of the industrys revenue, providing a highly effective buffer during economic downturns. This mechanism gives customers an affordable way to upgrade their jewellery withoutspending a largeamount of new cash. Consequently, gold exchange acts as a vital stabiliser, helP1ng to keep sales steady even during broader economic slowdowns when consumers might otherwise cut back on luxury spending.

Threats

1. Intense Industry Competition

The Indian jewellery market remains highly fragmented, with intense competition among national chains, regional brands, and local unorganised players across pricing, design innovation, and customer experience. However, established players like Kalyan Jewellers have built powerful, trust-led brand equity that increasingly insulates the business from these competitive pressures and protects market share.

2. Cold Price Volatility

Changes in global gold prices happen often and can lead customers to delay their purchases while they wait for better rates. Nevertheless, deep- rooted cultural customs protect baseline demand. As wedding purchases cannot be endlessly delayed, this non-discretionary market provides a strong safeguard against price fluctuations.

3. Regulatory Changes

Changes in government rules such as new taxes on gold, import limits, hallmarking requirements, or stricter KYC norms, can increase our costs and make compliance more complex.