Sky Gold and Diamonds reported strong performance for Q3 and 9 months FY’26, exceeding recent guidance. The company is shifting its focus to internal capital generation under the ‘Sky Gold 3.0’ strategy, aiming for a 30%-35% CAGR in revenue to reach INR 18,000 to INR 19,000 crores by FY’30, while achieving a net debt-free position by FY’30. Key operational highlights include significant growth in value-added products and a focus on manufacturing excellence.
Q3 FY’26 Performance and Strategic Shift
Sky Gold and Diamonds Limited announced the results for the quarter and nine months ended December 31, 2025. Managing Director, Mangesh Chauhan, highlighted the team’s strong performance in a challenging market, noting that the company is exceeding its previously increased guidance for Revenue, PAT, and ROCE.
The company is entering its third phase, ‘Sky Gold 3.0,’ which will be driven entirely by internally generated capital. The strategic focus is shifting to disciplined growth and robust free cash flow generation, targeting a 30% to 35% CAGR in revenue.
Vision 2030 and Financial Discipline
The long-term outlook remains robust, with management expecting to deliver INR 945 crores PAT by 2030 and achieving a net debt-free position by FY’30. To underscore financial discipline, promoters have agreed to a Zero salary compensation model starting FY’27, drawing compensation exclusively through dividends tied to shareholder returns. Furthermore, starting from April 1, 2026, a global audit firm will be engaged.
CFO Siddharth Sipani confirmed that price movements do not directly impact margins as the company is fully back-to-back hedged. Gross margin has seen significant improvement, standing at 8.27% year-to-date in FY’26, up from 5.97% in FY’24, driven by gold loss reduction, advanced gold business growth, and better margins from 18kT studded jewelry.
Merchandising and Market Expansion
Akash Talesara, President, Sales and Business Development, detailed the company’s focus on merchandising strength, noting that value-added products now contribute over 50% of revenue, up from just 4-5% three years ago. Key achievements include onboarding major GCC retailer Damas and securing exclusive partnerships with De Beers for key campaigns.
The strategy includes aggressive growth in the domestic corporate segment while expanding international footprint. The company has established an office in the Dubai Gold Souk to drive exports, which are targeted to reach 20% of sales, up from 10% this quarter. The long-term plan for entering developed markets like the EU, U.K., and U.S. is tentatively set for May ’28–’29, after groundwork in product development is completed.
Operational Efficiencies and Working Capital
Manufacturing expertise has been enhanced, leading to a 30% to 40% faster delivery time and making jewelry 20% to 30% lighter through advanced techniques like 3D printing and hollow stamping. Manufacturing excellence is also reflected in a reduction of gold loss from 1.5% to 0.5%.
The working capital cycle is steadily improving, moving from 66 days in September to 63 days in December, with a target to drop below 60 days by the end of the current fiscal year. The ultimate focus is achieving cash flow neutrality by March ’26.
Q&A Highlights
- Advanced Gold Contribution: Advanced gold contributed 12% of volume this quarter, equating to INR 11 crores in making charges.
- Gold Price Impact on Demand: While buyers of bullion wait for corrections, jewelry purchasing, driven by gifting and occasions, remains resilient. Consumers are shifting towards lighter weight options like 18kT and 9kT.
- FY’27 Revenue Guidance: While the revenue goal is INR 18,000-19,000 crores by 2030, the revenue guidance for the coming year (FY’27) is expected to be around INR 8,100 crores, supported by an estimated average volume of 750 kgs.
- Dilution Plans: Management confirmed they are nicely funded and not planning any equity dilution or further fundraising until FY’30, relying on internal accruals.
Source: BSE
