P N Gadgil Jewellers Ltd, a prominent jewellery retail chain, saw its share price dip by nearly 3% during Thursday’s trading session despite reporting a strong Q3 FY25 business update. The company recorded a 24% year-on-year (YoY) increase in consolidated revenue, driven by robust sales during the festive and wedding season.

Key Highlights from Q3 FY25 Business Update

1. Retail Segment:
   The retail division played a pivotal role, achieving a 42% YoY growth in revenue, supported by strong same-store sales growth. The festive season, including Dussehra and Diwali, significantly boosted footfall and customer spending.

2. E-commerce Growth:
   The e-commerce segment showed exceptional performance, with a 98% YoY increase in revenue. This reflects the growing preference for online jewellery shopping, particularly during the festive and wedding seasons.

3. Franchise and Diamond Segments:
   The franchise model demonstrated an impressive 87% YoY growth, while the diamond category experienced a 40% YoY increase in revenue. This highlights the company’s diverse revenue streams and customer base.

4. Store Expansion:
   In line with its expansion strategy, P N Gadgil opened nine outlets over nine consecutive days during Navratri in October 2024. The company plans to open three more outlets in the next quarter, reinforcing its commitment to growth.

Share Price Performance

On Thursday, the stock opened at an intraday high of ₹690.70 on the BSE, before dipping to an intraday low of ₹654 per share. This decline occurred despite the positive Q3 update, indicating investor caution or profit booking following the report.

According to Rajesh Bhosale, Equity Technical and Derivative Analyst at Angel One, the stock has been trading within a range of ₹630-700 in recent sessions. A breakout in either direction could determine the next significant move:

• Below ₹630, prices could slip towards ₹600.
• Above ₹700, prices might climb to ₹740.

Analyst Recommendations

Brokerage firm Motilal Oswal Financial Services has given a "Buy" recommendation for P N Gadgil shares, with a target price of ₹950 per share. This optimistic outlook reflects confidence in the company’s growth potential and strategic initiatives.

Market Position and Expansion Strategy

P N Gadgil, based in Pune, has emerged as the second-largest jewellery operator in Maharashtra by store count. The brand has established 48 outlets across India and the USA, utilizing a mix of COCO (Company-Owned, Company-Operated) and FOCO (Franchise-Owned, Company-Operated) models to maintain quality and extend its market reach.

The company’s focus on expanding its retail footprint aligns with its vision of catering to a wider audience and enhancing brand visibility. By opening nine stores during Navratri and planning three more in the upcoming quarter, P N Gadgil aims to capitalize on growing demand for jewellery.

Conclusion

While the 3% drop in share price may concern short-term investors, P N Gadgil’s strong Q3 performance, e-commerce success, and expansion plans reflect a positive long-term trajectory. Analysts recommend keeping an eye on technical breakout levels for potential trading opportunities, while long-term investors may view this dip as a buying opportunity given the company’s robust fundamentals.

The Upcoming IPOs in this week and coming weeks are Sat Kartar Shopping,Barflex Polyfilms and Laxmi Dental.

The Current active IPO are Standard Glass Lining, Quadrant Future, Capital Infra Trust, Delta Autocorp, Avax Apparels, B R Goyal.