VAIBHAVGBL - Vaibhav Global

📊 NSE: VAIBHAVGBL 🏢 Diamond Cutting / Jewellery 📅 Last Updated: 12/14/2025 14:52

💰 Financial Performance

Revenue Growth by Segment

Consolidated revenue grew 10.2% YoY to INR 877 Cr in Q2 FY26. The B2C segment is supported by the Budget Pay program, which contributes 38% of total B2C revenue. FY25 revenue was INR 3,380 Cr, up 11% YoY.

Geographic Revenue Split

Geographic revenue is concentrated in the US, UK, and Germany, which together account for 88% of FY25 revenue. In FY25, the US grew 2%, the UK grew 10%, and Germany grew 21% YoY. Germany's monthly revenues crossed EUR 2.1 million.

Profitability Margins

Gross margins remained firm at 63.5% in Q2 FY26, consistent with historical trends. PAT increased by 71% YoY to INR 48 Cr in Q2 FY26. FY25 PAT was INR 153 Cr, up 21% YoY.

EBITDA Margin

EBITDA margin improved by 130 basis points to 10% in Q2 FY26, up 28% YoY in absolute terms. FY25 EBITDA was INR 317 Cr with a 9.4% margin.

Capital Expenditure

Not disclosed in absolute INR Cr, but the company reported Free Cash Flow of INR 55 Cr in Q2 FY26 after accounting for inventory investments.

Credit Rating & Borrowing

CARE reaffirmed ratings at CARE A+; Stable / CARE A1 in October 2025. ICRA upgraded ratings to [ICRA]A+ (Stable) / [ICRA]A1+ in July 2025. The company maintains a net cash positive position of INR 156 Cr.

⚙️ Operational Drivers

Raw Materials

Gemstones, gold, silver, and lab-grown diamonds. The company operates a vertically integrated model where raw materials are processed into gemstone-studded fashion jewellery.

Import Sources

China is a significant sourcing location, as evidenced by the company's strategic inventory advancement to mitigate 50% US tariff risks on Chinese imports.

Key Suppliers

Not disclosed by name, but the company maintains an established global supplier network to support its vertically integrated supply chain.

Capacity Expansion

Not disclosed in MT/units; however, the company is expanding its addressable market by 20% through its German operations and recent acquisitions like Ideal World and Mindful Souls.

Raw Material Costs

Gross margins of 63.5% imply that raw material and direct production costs represent approximately 36.5% of revenue. The vertically integrated model helps maintain these margins above 60%.

Manufacturing Efficiency

Productivity improvements led to a 160 basis point improvement in employee costs as a percentage of revenue in Q2 FY26.

Logistics & Distribution

Shipping costs showed a 30 basis point improvement YoY in Q2 FY26, while airtime costs for broadcasting improved by 40 basis points YoY.

📈 Strategic Growth

Expected Growth Rate

7-9%

Growth Strategy

Growth will be driven by scaling the German market (21% growth in FY25), turning around Ideal World (achieved profitability in H2 FY25), and expanding lab-grown diamond sales which have reached double-digit percentages of total sales. The company targets mid-teens revenue growth in the medium term.

Products & Services

Gemstone-studded fashion jewellery, lifestyle products, and lab-grown diamonds sold via TV shopping channels and e-commerce platforms.

Brand Portfolio

Shop LC (USA), TJC (UK), Shop TJC (Germany), Ideal World (UK), and Mindful Souls.

New Products/Services

Lab-grown diamonds have reached double-digit percentage of sales, providing a new high-growth product category.

Market Expansion

Germany is the primary expansion market, now in its 4th year and contributing to a 20% increase in the Group's addressable market.

Market Share & Ranking

Not disclosed as a specific percentage, but competes with major players like QVC and Shop HQ.

🌍 External Factors

Industry Trends

The industry is shifting toward omni-channel retail and lab-grown diamonds. VGL is positioned with a 60%+ gross margin model and growing digital contributions.

Competitive Landscape

Key competitors include Qurate Retail (QVC), Shop HQ, and Amazon, along with traditional brick-and-mortar jewellery retailers.

Competitive Moat

The moat is built on a vertically integrated supply chain and an omni-channel 'TV + Web' presence. This allows for 60%+ gross margins which are structurally higher than traditional retailers.

Macro Economic Sensitivity

High sensitivity to consumer discretionary spending in the US and UK, which represent the bulk of the 88% geographic revenue concentration.

Consumer Behavior

Increasing consumer acceptance of lab-grown diamonds and a shift toward digital/web-based shopping platforms.

Geopolitical Risks

Trade barrier impacts from US-China relations, specifically the threat of 50% tariffs on Chinese-sourced goods.

⚖️ Regulatory & Governance

Industry Regulations

Operations are subject to local e-commerce and retail regulations in the US, UK, and Germany, including consumer protection and data privacy laws.

Environmental Compliance

The company holds an ICRA ESG rating of 'Strong: 73' and is RJC (Responsible Jewellery Council) certified.

Taxation Policy Impact

Not disclosed; however, the company maintains a 53% dividend payout ratio.

⚠️ Risk Analysis

Key Uncertainties

Potential 50% US tariffs on Chinese imports could increase COGS. Economic slowdowns in the US/UK could reduce demand for discretionary jewellery by 10-15%.