Senco Gold shares surge 16% after strong Q4 biz update; stock up 190% from IPO price

Shares of Senco Gold Ltd surged during the trading session on Monday, to hit new record highs, after the company shared its business updates for the quarter and year ended on March 31, 2024. The stock has delivered multibagger returns to the investors.

Senco Gold reported 28 per cent year-on-year (YoY) revenue growth in full year and 39 per cent YoY in Q4. Despite rising gold prices, the company achieved 13 per cent volume growth in Gold and 19 per cent volume growth in diamond in the full year, said the company in the exchange filing with the bourses.

The same store sales growth (SSSG) for the entire fiscal was 19 per cent out of retail sales growth; and was 23 per cent out of total 30 per cent retail sales growth during Q4 giving a major impetus for growth contributing about, it said.

Senco Gold launched 23 showrooms on a net basis, reporting a 17 per cent growth, for the year ended on March 31, 2024. This included 4 showrooms in Q4FY24, taking the total showroom portfolio to 159, the highest ever expansion since the inception. The jewellery firm launched five franchisee owned franchise operated (FOFO) and company owned company operated (COCO) showrooms.

Following the business updates, shares of Senco Gold surged 15.60 per cent to Rs 927.20 on Monday, hitting its new highs and commanding a total market capitalization of more than Rs 7,200 crore. The scrip had settled at Rs 802.10 in the previous trading session on Friday.

Shares of Senco Gold have surged about 160 per cent from its 52-week low at Rs 358.25, hit on July 21, 2023. Even from the IPO price of Rs 317 apiece, the stock has rallied more than 190 per cent, almost triple from the issue price. The company was listed in July 2023 as it raised Rs 405 crore via its initial stake sale.

Gold prices continued its northward journey throughout FY 2023-24 including in Q4 on account of heightened geopolitical tensions, increased gold buying by central banks across the globe, high Fed rates and likely soft landing, exchange rates and momentum effect. Gold rates in global markets rose by almost 17 per cent, said the company.

"This price rise has led to a squeeze in the working capital availability due to higher margins for gold hedging and gold metal loan (GML). We continue to have optimistic outlook for FY 2024-25 as the first quarter has local new years and Akshay Tritiya on May 10, along with upcoming marriage season acting as tailwind for growth," it added.