THANGAMAYL - Thangamayil Jew.

📊 NSE: THANGAMAYL 🏢 Diamond Cutting / Jewellery 📅 Last Updated: 12/14/2025 14:18

💰 Financial Performance

Revenue Growth by Segment

The company reported total revenue of INR 3,259.92 Cr for H1 FY26, representing a 36% YoY growth compared to INR 2,398.43 Cr in H1 FY25. While specific segment percentages aren't fully broken down, non-gold jewellery contribution increased to approximately 10% of total revenue in FY25 from 8% in FY24, supporting overall top-line expansion.

Geographic Revenue Split

Thangamayil derives 100% of its revenue from the state of Tamil Nadu. The company is currently focusing on the Chennai metro region, where it plans to expand its presence to 10 outlets by the end of Q3 or early Q4 FY26 to capture higher market share in the state's capital.

Profitability Margins

Gross Profit Margin improved significantly to 11.11% in H1 FY26 compared to 7.96% in H1 FY25, a rise of 315 bps due to better revenue realization. Net Profit Margin (NPM) was 2.4% in FY25, moderated from 3.2% in FY24 due to a one-time inventory loss of INR 15.47 Cr from customs duty reductions and front-loaded expansion costs.

EBITDA Margin

EBITDA for H1 FY26 stood at INR 192.62 Cr, a 129% increase from INR 84.14 Cr in H1 FY25. This growth was driven by higher sales volumes and improved gross margins, despite a rise in operating expenses from INR 120.68 Cr to INR 216.22 Cr (up 79%) due to the opening of 9 new retail outlets.

Capital Expenditure

The company raised INR 510 Cr through a rights issue in March 2025 to strengthen its net worth and fund store expansions. Significant capital is being deployed into opening new retail outlets (9 added recently to reach a total of 66) and building inventory for these locations.

Credit Rating & Borrowing

ICRA upgraded the long-term rating to [ICRA]A+ (Stable). The average cost of borrowings stands at 6.08%, which is a slight increase from 5.47% in the previous period. The capital structure improved post-rights issue with a gearing of 0.7 times as of March 31, 2025.

⚙️ Operational Drivers

Raw Materials

Gold constitutes the primary raw material, accounting for approximately 90% of total revenue. Other materials include Silver, Platinum, and Diamonds, which make up the remaining 10% of the product mix.

Import Sources

Not specifically disclosed in the available documents, though the company is highly sensitive to Indian Union Budget changes regarding gold import duties.

Capacity Expansion

The company currently operates 66 retail outlets. It recently added 9 new stores and plans to increase its Chennai region presence to 10 outlets by late FY26. This expansion is intended to leverage brand equity and increase volume sales.

Raw Material Costs

Cost of raw materials is highly volatile based on global gold prices. In FY25, the company took a one-time inventory hit of INR 15.47 Cr due to a reduction in gold import duties. Procurement strategies include hedging 95.05% of inventory to mitigate price volatility.

Manufacturing Efficiency

Average stock turnaround time was 2.84 times in the recent period compared to 3.65 times previously. The decline is attributed to the front-loading of inventory for 9 newly opened stores that are yet to reach peak sales velocity.

📈 Strategic Growth

Expected Growth Rate

25%

Growth Strategy

Growth will be achieved through aggressive retail footprint expansion, specifically targeting the Chennai metro area. The company is also shifting its product mix toward non-gold items (diamonds/platinum) which offer higher margins of 29% to 40%. The recent INR 510 Cr equity infusion provides the capital base to support this 25% projected revenue growth.

Products & Services

The company sells gold jewellery, silver ornaments, platinum jewellery, and diamond-studded jewellery to retail consumers.

Brand Portfolio

Thangamayil

New Products/Services

Increased focus on non-gold jewellery (Diamond and Platinum) which currently contributes ~10% to revenue but is expected to grow due to higher consumer demand and better margins.

Market Expansion

Targeting the Chennai metro region with a goal of 10 outlets by Q3/Q4 FY26, expanding from its traditional base in Madurai and Southern Tamil Nadu.

Market Share & Ranking

Not disclosed in available documents, but noted as a leading organized player in Tamil Nadu.

🌍 External Factors

Industry Trends

The industry is seeing an accelerated shift from unorganized to organized players. Thangamayil is positioning itself to capture this by expanding its branded retail network and increasing transparency in pricing.

Competitive Landscape

Faces intense competition from large national players (like Titan/Tanishq) and regional unorganized jewellers. Competition is particularly aggressive in the Chennai market.

Competitive Moat

The company's moat is built on strong brand recall in Tamil Nadu and a deep 66-store retail network. This is sustainable because the high capital requirement for inventory and established trust in gold purity act as significant barriers to entry for new competitors.

Macro Economic Sensitivity

Highly sensitive to inflation and rural income levels in Tamil Nadu, as jewellery is both a consumption and investment good. Gold price trends directly dictate the 25% projected revenue growth.

Consumer Behavior

Shift toward lightweight jewellery and non-gold precious metals (Platinum/Diamond) among younger consumers, prompting the company to increase non-gold stock to 10% of revenue.

Geopolitical Risks

Global geopolitical tensions affecting gold prices are a primary risk, as they influence the base cost of 90% of the company's inventory.

⚖️ Regulatory & Governance

Industry Regulations

Operations are affected by Hallmarking mandates, PMLA (Prevention of Money Laundering Act) compliance for high-value transactions, and changes in gold import duties by the Central Government.

Environmental Compliance

Environmental risk is rated as low for the jewellery retail industry.

Taxation Policy Impact

The company is subject to standard corporate tax rates. It recently managed a transition in customs duty which resulted in a one-time inventory valuation hit.

Legal Contingencies

The company has a pending appeal before the High Pitch order review committee regarding a mandatory 25% collection stay. Status quo currently prevails on this matter.

⚠️ Risk Analysis

Key Uncertainties

Volatility in gold prices remains the single largest uncertainty, with the potential to cause significant inventory gains or losses. Regulatory shifts in import duties also present unpredictable margin risks.