Shares of Kalyan Jewellers Ltd. rose between 40% [1] and nearly 50% [2] over five consecutive trading sessions on Indian stock markets.
The rally indicates a shift in investor sentiment toward the company's expansion strategy. While the stock has underperformed its peer, Titan, over the past year, the current surge suggests the market is beginning to price in the jeweler's international growth.
Revenue from international operations grew by about 35% [3] year-over-year. This growth was supported by the Middle East business, which saw revenue increases of around 30% [3]. Currently, international markets contribute about 14% [3] to the company's consolidated revenue.
The stock showed continued momentum on Monday morning, trading at Rs 518.50 per share, which represented a 9% increase for the day [1].
Analysts said the rally is occurring while the stock still trades at a valuation discount. Some reports indicated a 36% rise [4] occurred within just three days of the rally, highlighting the volatility and speed of the price movement.
Despite the short-term gains, the company's performance relative to Titan remains a point of focus for analysts. The surge is viewed as a correction of the previous discount rather than an immediate leap to overvaluation.
“Shares of Kalyan Jewellers Ltd. rose between 40% and nearly 50% over five consecutive trading sessions.”
The rapid ascent of Kalyan Jewellers' stock reflects a market correction based on the company's diversifying revenue streams. By successfully expanding into the Middle East and other international markets, the company is reducing its reliance on the domestic Indian market, making it more attractive to investors who previously viewed it as undervalued compared to industry leaders like Titan.
