Senco Gold vs Sutlej Textiles and Q3 FY26

Senco Gold delivered a historic Q3 FY26 with revenue of ₹3,000 Cr (+50% YoY), EBITDA of ₹400 Cr (13.2% margin, +210bps YoY), and PAT of ₹264 Cr (+689% YoY). The stellar performance was driven by strong festive and wedding demand, a shift to lightweight and diamond studded jewelry (studded value +38% YoY), and operating leverage from higher own-store sales (65% of revenue). Management guided for Q4 revenue growth of 25-30% YoY and a sustainable EBITDA margin of 7.5-7.8% for FY27, with near-term margins benefiting from elevated gold prices. Key risks include gold price volatility impacting volume growth (gold volume -10% in 9M) and working capital strain from high inventory levels (₹4,602 Cr).

Guidance read

Q4 FY26 revenue growth of 25-30% YoY: Management guided for 25-30% revenue growth in Q4, conservatively, despite gold price volatility and seasonal factors like Holi. FY27 sustainable EBITDA margin of 7.5-7.8%: For FY27, management expects EBITDA margin of 7.5-7.8% at current gold prices, with 7.3-7.5% if prices moderate. FY27 store addition of 18-20 stores: Plans to open 18-20 stores in FY27, with a mix of 8-10 own stores and 8-10 franchise stores, focusing on franchise expansion. Hedging ratio to remain 55-60% near-term: Hedging ratio will stay at 55-60% due to gold price volatility and working capital constraints; may increase to 80-90% if stability returns.

Risk read

Key risks include Gold price volatility impacting volume — Gold volume declined 10% in 9M FY26; further price spikes could compress consumer budgets and reduce footfalls, pressuring revenue growth.; Working capital strain from high inventory — Inventory value rose to ₹4,602 Cr (from ₹2,963 Cr), funded by borrowings; elevated gold prices increase working capital needs and interest costs.; Hedging policy opacity and margin call risk — Management declined to disclose detailed hedging strategies; recent gold price swings caused margin calls, and low hedging (55-60%) exposes balance sheet to price drops.; Realization gain dependency on gold price rise — 2-2.5% of EBITDA margin in 9M came from realization gains; if gold prices stabilize or fall, margins could revert to 7.5-7.8% guidance..

Promise ledger

Scorecard data is being built as historical quarters are processed.

Sutlej Textiles reported Q3 FY26 standalone revenue of INR 640 cr, down 2% YoY, but EBITDA surged over 200% YoY to INR 25 cr with margin expansion of 350 bps to 4%. PAT remained negative at INR -11 cr. The improvement was driven by cost optimization initiatives (30-40% of targeted savings achieved), product mix shift towards value-added yarns, and market diversification into Far East and Africa, reducing Bangladesh concentration. Home textiles order book provides visibility through Q1 FY27. Management expects Q4 to show continued sequential improvement, with full benefits of cost savings and renewable energy tie-ups (from Q1 FY27) flowing in over 2-3 quarters. Key risk: raw material price volatility, especially cotton, which rose 7-8% during the quarter and could pressure margins if not passed through.

Guidance read

Q4 FY26 sequential improvement in profitability: Management expects Q4 to be better than Q3, with continued momentum in operating margins. Cost savings target 40% achieved, full benefit in 2-3 quarters: Employee rationalization and process improvements have delivered ~40% of targeted annual savings; remaining benefits expected over next 2-3 quarters. Renewable energy benefits from Q1 FY27: Tied up for renewable energy; benefits expected to accrue from Q1 FY27, reducing energy cost (40% of yarn conversion cost). Home textiles order book visibility through Q1 FY27: Order book for home textiles provides visibility of ~120 days, i.e., through Q1 of next fiscal.

Risk read

Key risks include Raw material price volatility — Cotton prices increased 7-8% during the quarter; volatility in cotton and polyester prices can pressure margins if not passed through.; Bangladesh trade disruption — Bangladesh logistical issues have impacted yarn exports; management reduced exposure but uncertainty remains until elected government takes charge.; Global demand uncertainty and tariff risks — US-India trade situation and potential tariffs could affect export volumes; management notes real benefits may take two quarters to materialize.; Margin pressure in yarn business — Yarn segment EBITDA was only INR 1 cr despite contributing majority revenue; raw material inflation and competition keep margins under pressure..

Promise ledger

Scorecard data is being built as historical quarters are processed.