Bluestone Jewellery shares rocket 36% in just three days after Q1 results. Can the momentum sustain?

Shares of BlueStone Jewellery rallied another 7% to Rs 832 on the BSE on Thursday, extending their winning streak to a third straight session and taking gains to 36% over the period. The buying momentum follows a strong Q1 performance, with the company reporting a net profit of Rs 14 crore, compared with a net loss of Rs 21 crore in the corresponding quarter last year.

The company said its standalone revenue rose 48.8% year-on-year to Rs 733 crore. Same-store sales growth stood at 39% YoY during the quarter, while standalone EBITDA increased 134.6% YoY to Rs 55 crore. The company added 12 stores in Q1FY27, taking its total store count to 352 across 139 cities.

The company said the performance reflected resilient consumer demand and the relevance of its portfolio across different price points. Operating leverage continued during the quarter, with the EBITDA margin improving by 273 basis points from a year earlier. After reporting its first full year of positive reported PAT in FY26, BlueStone continued its profitability trajectory into FY27.

The company added that the “performance is particularly satisfying as it came despite the rise in custom duty on gold from 6% to 15%, reflecting the structural drivers we have consistently spoken about – a portfolio that stays relevant across price points th rough design and technique innovation.”

What to expect post Q1 results?

Systematix has maintained a Buy rating on BlueStone Jewellery with a target price of Rs 832, level the stock clinched today. The brokerage expects the company to add around 75 stores annually and expand its total store network to 571 outlets by FY29E.

Also read:Q1 surprise sends jewellery stocks shining 40% in a month. Will the surge last in next quarters?

The brokerage said the expansion plan appears achievable, subject to sustained consumer traction and continued brand strengthening. Its revenue estimates factor in an age-cohort framework, under which store productivity improves as outlets mature.
Stores that were more than three years old accounted for 27% and 46% of the network in FY25 and FY26, respectively, and this proportion is expected to rise to 56% in FY28E and 60% in FY29E. Systematix expects the average store age to increase from 2.3 years in FY25 and 2.7 years in FY26 to 3.6 years in FY28E and 4 years in FY29E.The outlook beyond the June quarter also remains constructive as leading players continue to project strong long-term demand.

“The strong start to FY27 by market leaders reinforces confidence in the sector’s demand outlook. Within our coverage universe, we prefer Titan Company and Bluestone Jewellery as our preferred picks over the next 12–18 months,” Pankaj Kumar, VP Fundamental Research at Kotak Securities, told ETMarkets.

Anil shares a similar view, saying the growth momentum appears sustainable beyond Q2, although the pace will depend on gold price movements and consumer sentiment. Stable gold prices should support demand, as jewellery purchases are typically influenced more by price volatility than by absolute price levels. He also believes initiatives such as gold exchange and recycling programmes will improve affordability and customer engagement.

Importantly, the second half of the year is typically stronger for the industry, supported by the festive season and the peak wedding period. If gold prices remain relatively stable, leading organised jewellery retailers should continue delivering healthy growth over the coming quarters.

Going forward, investors will closely monitor management commentary, festive season demand and the pace of store expansion, all of which are likely to shape the sector’s performance over the coming quarters.

(Disclaimer: Recommendations, suggestions, views and opinions given by the experts are their own. These do not represent the views of The Economic Times)