Sky Gold delivered a strong Q3 & has upped it's FY27 revenue guidance by 14%. In this follow-up note, we examine the key achievements, growth drivers and revised financial projections
Great analysis! Sky Gold has a lot of potential, especially with the way they’re bringing big players on board and the strong demand for gold. Fundamentals look solid, and at the moment, there seem to be no major headwinds ahead.
My only concern, from a technical perspective, it’s interesting to see that Sky Gold seems to be forming head and shoulders pattern while holding the 310 support level. If this support breaks, the next key level to watch would be around 240. It might be worth waiting to see how the stock behaves in the coming weeks before making a move. If you like it at 310, you’ll love it at 240!
Just my thoughts—really appreciate your work and always look forward to your insights.
Thanks, Mr. Shankar, for the analysis provided. I was going through comments section after reading your article, it shows how much time needs to be spent on analyzing stocks and like you mentioned in one of your comments below, it is a lifelong learning.
I am posting this comment only to commend your hard work, I really admire your work and attitude. Please keep up the good work!
Thank you so much for your kind words, Sandeep ji.
The last two years had helped me develop a better appreciation of the word "capital". We often associate it with 'money' -- saying, I need money to make money. However now I feel there are other sources of capital that can also be put to good use such as: time, connections, hardwork, personal brand, idea, concept, authenticity, convenience to others etc.
In this digital age, for anyone & everyone who desires to shift from a salaried structure to a self-employed/business one -- I'll encourage them to maximize all modes of capital (esp. the non-money factors). Nothing is easy though but if done well, the output will more than make up for the effort put it
At the outset, thank you Shankar ji for such a detailed analysis. Highly appreciate the time taken to put this together. Gives us confidence and a strong rationale to hold what we hold. Also, look forward for the paid subscription model given that the amount of learning is tremendous.
I have one clarification on the valuation. In the article, you had mentioned that the conservative revenue for FY26 is 6300 Cr. However, while doing the valuation you considered the management guidance which is 7200 Cr. Please suggest if considering 6300 Cr will have any major impact on the valuation.
Thank you Mr. Chakravarthy. Yes, a large element of the community will be interactions. I would love to see all members participate in research, discovery & selection. There will be difference in views but a healthy discussion will help us see opportunities & gaps
Yes, Part of the reason I used ₹6,300 crs in lieu of ₹7,200 -- was post an examination of growth estimates given by jewellery retailers. This number ranged from 20% to 40% and was a function of new showrooms and SSGR (same store growth rates)
For Sky Gold -- in growth estimates from existing client, the addition of new business from Aditya Birla does help substantiate their estimates. Running the numbers & after excluding the 18-carat/diamond sales -- the use of ₹6,300 crs gives me a revenue CAGR of 34% while at ₹7,200 crs this went up to 42% CAGR (which was beyond the range)
With re: your query, at ₹7,200 crores (versus ₹6,300 crs) the revised simulation stands at:
1. FY27 EPS estimate comes to ₹16.6 (vs ₹14.1 per my estimates)
2. EPS growth comes to 39.8% (vs 30% per my estimates)
Most welcome. Zaggle Prepaid is one complicated business, it'll take me some more time to understand it. I'm hoping some members within the community can help out with their assessment of it
Thank you so much Shankar ji for the quick and detailed. Very clearly explained. While I am still a novice in terms of my knowledge, appreciate if you can take a detailed session on valuation, May be through the subscription route. Best wishes
Yes, me & Priyam will take interested members through our research. While you've read some of our work, we have been rejecting (or holding for later) a much higher count of companies (1:5 ratio, atleast). This will help members understand nuances of research.
We aren't there yet ourselves but everyday I'm learning something new. Investing is a lifelong skill and I'd rather make my mistakes when I'm young (hmm .. middle aged) and lock that experience/learning in my memory. That's the way we are working things out & having more members around will aid everyone's growth
Please have a read of Sky Gold at your end too (transcript, twitter, valuepickr, reports on telegram etc.). More research & interactions will help us improve our selection
Great read Shankar. Any thoughts on Thangmayil and how it compares to Sky Gold. I see a lot of interest in this around the fundamental investing community from this sector.
1. Thangamayil Jewellery is in the B2C business (jewellery showrooms) while Sky Gold is B2B (manufacturer of jewellery for retail chains like Thangamayil). Not very comparable
2. Thangamayil has not entered our query filters yet. I'll circle back when it does
What is your view on the rising gold prices? Do you think it will impact the output volume of players like Sky Gold, considering:
A) The budget for bridal jewellery remains the same, but the end consumer will reduce the quantity they purchase.
B) There will be pressure on making charges from larger players to sell their existing stock (e.g., players like CaratLane offer 100% off on making charges—I understand they may offset it to some extent through capital appreciation).
Additionally, while this hasn't directly come up for discussion in the transcripts I've read .. there was an indirect mention where the Sky Gold management referred to increasing sales of 18-carat jewellery (3% of revenue in Q2 to almost 5% in Q3FY25). The implied nature is that as gold prices increase, some portion of the consumers will move to 18-carat and presumably, a stability/reduction in gold prices will get back the demand for 22-carat
Sir please once have a look on beta drugs lmtd cmall cap company with a fair valuation and and hight growth company and this company also entered in cdmo buisness that will extra boost their buisness revenue, and 12 to 16 cagr growth in cdmo industry.. please have look on this company and please make a detailed note on this please sir like zen tec hariom pipes sky gold etc ..
Hello. Beta Drugs is listed on the SME-exchange, I generally avoid such companies due to lack of disclosure. If you have come across a detailed investing thesis, please forward the same to me at hello@beginnersbuck.com
Hello Shankar
Great analysis! Sky Gold has a lot of potential, especially with the way they’re bringing big players on board and the strong demand for gold. Fundamentals look solid, and at the moment, there seem to be no major headwinds ahead.
My only concern, from a technical perspective, it’s interesting to see that Sky Gold seems to be forming head and shoulders pattern while holding the 310 support level. If this support breaks, the next key level to watch would be around 240. It might be worth waiting to see how the stock behaves in the coming weeks before making a move. If you like it at 310, you’ll love it at 240!
Just my thoughts—really appreciate your work and always look forward to your insights.
Regards
Kuldeep Brar
Hello Kuldeep ji - Unfortunately, I don't understand technical analysis so can't really comment on this. Thank you for your kind appreciation 🙌
Thank you so much sir! It is an amazing analysis it helps alot to me. 🙏🙏🙏
Most welcome!
Shankar Bhai,
Appreciate your detailed analysis and meaningful projection. It goes long way for us to understand the nity gritty of the Securities. 🙏🙏🙏
Thank you very much 🙌 .. I'm happy you're finding this helpful
Thanks, Mr. Shankar, for the analysis provided. I was going through comments section after reading your article, it shows how much time needs to be spent on analyzing stocks and like you mentioned in one of your comments below, it is a lifelong learning.
I am posting this comment only to commend your hard work, I really admire your work and attitude. Please keep up the good work!
Thank you so much for your kind words, Sandeep ji.
The last two years had helped me develop a better appreciation of the word "capital". We often associate it with 'money' -- saying, I need money to make money. However now I feel there are other sources of capital that can also be put to good use such as: time, connections, hardwork, personal brand, idea, concept, authenticity, convenience to others etc.
In this digital age, for anyone & everyone who desires to shift from a salaried structure to a self-employed/business one -- I'll encourage them to maximize all modes of capital (esp. the non-money factors). Nothing is easy though but if done well, the output will more than make up for the effort put it
THANKS A LOT SIR, FOR YOUR KIND INFORMATION. THANKS A LOT 🙏🙏🙏
Most welcome 🙌
Thx Shankar for this detailed & informative write up with future projections.
👍👍👍👍🙏🙏🙏🙏🙏
Most welcome 🙌
thanks shankar ji for new update
Most welcome 🙌
At the outset, thank you Shankar ji for such a detailed analysis. Highly appreciate the time taken to put this together. Gives us confidence and a strong rationale to hold what we hold. Also, look forward for the paid subscription model given that the amount of learning is tremendous.
I have one clarification on the valuation. In the article, you had mentioned that the conservative revenue for FY26 is 6300 Cr. However, while doing the valuation you considered the management guidance which is 7200 Cr. Please suggest if considering 6300 Cr will have any major impact on the valuation.
Thank you Mr. Chakravarthy. Yes, a large element of the community will be interactions. I would love to see all members participate in research, discovery & selection. There will be difference in views but a healthy discussion will help us see opportunities & gaps
Yes, Part of the reason I used ₹6,300 crs in lieu of ₹7,200 -- was post an examination of growth estimates given by jewellery retailers. This number ranged from 20% to 40% and was a function of new showrooms and SSGR (same store growth rates)
For Sky Gold -- in growth estimates from existing client, the addition of new business from Aditya Birla does help substantiate their estimates. Running the numbers & after excluding the 18-carat/diamond sales -- the use of ₹6,300 crs gives me a revenue CAGR of 34% while at ₹7,200 crs this went up to 42% CAGR (which was beyond the range)
With re: your query, at ₹7,200 crores (versus ₹6,300 crs) the revised simulation stands at:
1. FY27 EPS estimate comes to ₹16.6 (vs ₹14.1 per my estimates)
2. EPS growth comes to 39.8% (vs 30% per my estimates)
3. Projected price range is at:
a) PE = 30; Annualized return of 21.3% (vs 12.2%)
b) PE = 35; Annualized return of 30.6% (vs 20.8%)
c) PE = 40; Annualized return of 39.3% (vs 28.8%)
d) PE = 45; Annualized return of 47.4% (vs 36.3%)
Hi Shankar, thanks for the insights. Eagerly waiting for your note on Zaggle prepaid ✌️
Most welcome. Zaggle Prepaid is one complicated business, it'll take me some more time to understand it. I'm hoping some members within the community can help out with their assessment of it
Please let me know if there's anything I can help with.
Thank you so much Shankar ji for the quick and detailed. Very clearly explained. While I am still a novice in terms of my knowledge, appreciate if you can take a detailed session on valuation, May be through the subscription route. Best wishes
Most welcome, thank you for your kind wishes!
Yes, me & Priyam will take interested members through our research. While you've read some of our work, we have been rejecting (or holding for later) a much higher count of companies (1:5 ratio, atleast). This will help members understand nuances of research.
We aren't there yet ourselves but everyday I'm learning something new. Investing is a lifelong skill and I'd rather make my mistakes when I'm young (hmm .. middle aged) and lock that experience/learning in my memory. That's the way we are working things out & having more members around will aid everyone's growth
Thanks Shankar ji for the your insights👍
Most welcome Praveen ji.
Please have a read of Sky Gold at your end too (transcript, twitter, valuepickr, reports on telegram etc.). More research & interactions will help us improve our selection
Thank you Shankar Ji,when are you planning to launch paid community to discuss about more opportunities that are available in this Market,Thanks
Most welcome. Launch is next weekend, Suresh ji (high probability!)
Am going through starting-up pangs .. a part of the video describing the community turned out to be corrupted, will have to do it again
Sorry about that,Thank you for your efforts
No worries, all in a day's work :) .. have a pleasant weekend
Can you please issue a newsletter reviewing and analysing Senco Gold.
Thank you for the suggestion. Senco Gold hasn't entered our query filters yet. We'll evaluate it once it does
Is holding the stock in this market Condition a wise decision or one should exit and enter when the market is stable.
Hello sir,
Can you see any value in POLICY BAZAAR as its eps turning positive from negetive on YOY basis with increasing sales sales and profit..??
Hello Vishal ji, PB Fintech hasn’t entered our screening queries. I’ll circle back on this once it does
Great read Shankar. Any thoughts on Thangmayil and how it compares to Sky Gold. I see a lot of interest in this around the fundamental investing community from this sector.
Would be great to see a report.
Thanks
Thank you! 🙌
1. Thangamayil Jewellery is in the B2C business (jewellery showrooms) while Sky Gold is B2B (manufacturer of jewellery for retail chains like Thangamayil). Not very comparable
2. Thangamayil has not entered our query filters yet. I'll circle back when it does
Thanks
What is your view on the rising gold prices? Do you think it will impact the output volume of players like Sky Gold, considering:
A) The budget for bridal jewellery remains the same, but the end consumer will reduce the quantity they purchase.
B) There will be pressure on making charges from larger players to sell their existing stock (e.g., players like CaratLane offer 100% off on making charges—I understand they may offset it to some extent through capital appreciation).
I have not formed a view on it.
Additionally, while this hasn't directly come up for discussion in the transcripts I've read .. there was an indirect mention where the Sky Gold management referred to increasing sales of 18-carat jewellery (3% of revenue in Q2 to almost 5% in Q3FY25). The implied nature is that as gold prices increase, some portion of the consumers will move to 18-carat and presumably, a stability/reduction in gold prices will get back the demand for 22-carat
Sir please once have a look on beta drugs lmtd cmall cap company with a fair valuation and and hight growth company and this company also entered in cdmo buisness that will extra boost their buisness revenue, and 12 to 16 cagr growth in cdmo industry.. please have look on this company and please make a detailed note on this please sir like zen tec hariom pipes sky gold etc ..
Hello. Beta Drugs is listed on the SME-exchange, I generally avoid such companies due to lack of disclosure. If you have come across a detailed investing thesis, please forward the same to me at hello@beginnersbuck.com