47% gains in 4 days: What's driving Kalyan Jewellers shares?
What's the story
Kalyan Jewellers' shares continued their upward trajectory on Monday, rising another 10% to ₹522 on the NSE. The stock has gained 47% over the last four trading sessions. This surge can be attributed to the company's better-than-expected Q1FY27 business update, which sparked renewed buying interest among investors. The company's consolidated revenue for Q1FY27 is estimated to have grown by 38% year-on-year.
Resilience
Strong operating momentum sparks investor interest
Despite the entire 28-day Adhik Maas period, a once-in-three-years occasion generally considered unfavorable for weddings, falling in the recently concluded quarter, Kalyan Jewellers has performed well.
The company's strong performance is credited to healthy operating momentum and robust same-store sales growth across key Indian markets.
Sudeep Shah of SBI Securities noted that the shares have shown a fresh consolidation breakout on the weekly chart with rising trading volumes.
Market trends
Technical indicators suggest bullish momentum
The stock is also above the upper Bollinger Band, a sign of strong trending moves. As long as it stays above the ₹425-430 zone, the bullish bias is likely to remain intact.
Citi has a target price of ₹750 on Kalyan Jewellers shares, indicating a potential upside of 58%.
ICICI Securities also maintains a 'Buy' rating with a target price of ₹670, implying an upside potential of 41%.
Growth drivers
Jewelry stocks rally despite macroeconomic headwinds
Citi expects Kalyan Jewellers' franchise-led expansion strategy to drive future revenue growth.
The brokerage also believes the company's asset-light model will help in deleveraging while improving return on capital employed (ROCE).
Despite headwinds such as rising oil prices, inflation concerns, and expectations of higher interest rates amid the West Asia crisis, India's listed jewelry stocks have rallied up to 47% in just one month.