Lalithaa Jewellery Mart IPO

Strengths · 7

• 01FY2026 was a very strong year. Total income grew 48% from Rs 16,907.88 crore to Rs 25,039.80 crore, and profit after tax grew 177% from Rs 364.73 crore to Rs 1,009.82 crore.
• 02Return ratios are high. RoCE was 42.60% and RoNW was 39.90%.
• 03The issue is priced low on earnings. At the upper band of Rs 201 the post issue P/E is about 11.14 times on an EPS of Rs 18.04.
• 04The company has a long track record. It has been in the jewellery business since November 1985, which is about 40 years.
• 05It has deep reach in Tier II and Tier III cities of South India, where organised jewellery chains are still growing.
• 06Out of the Rs 1,700 crore issue, Rs 1,200 crore is fresh money. About Rs 1,033.23 crore of that is for opening 10 new stores.
• 07The jewellery schemes give the company a steady flow of customer money and repeat buying.

Risks · 8

• 01The big jump in profit is of one year only. Between FY2024 and FY2025 total income was almost flat, moving only from Rs 16,800.62 crore to Rs 16,907.88 crore, which is less than 1% growth.
• 02Profit margin is thin. PAT margin was only 4.04%, which is normal in gold retail but means a small rise in cost or fall in price can hurt profit quickly.
• 03Borrowing went up 69% in one year, from Rs 949.26 crore to Rs 1,604.14 crore.
• 04Rs 500 crore of the Rs 1,700 crore issue is an offer for sale. That money goes to the selling shareholders, not to the company.
• 05Most of the fresh money goes into stock, not into fixed assets. Out of Rs 1,033.23 crore for new stores, Rs 998.68 crore is for inventory. This is a working capital heavy business.
• 06The business is concentrated in South India. Any slowdown, local competition or regulation in that region will affect almost the whole business.
• 07Gold price movement and festive season demand decide sales. A sharp rise in gold price usually slows down buying by volume.
• 08Promoter holding will come down from 97.72% to 82.85% after the issue.

Lalithaa Jewellery Mart Limited was started in November 1985. It is a jewellery retail company from South India. The company sells gold, silver, diamond and other precious and semi-precious jewellery. Its main customers are middle class and value conscious buyers who look at price carefully before buying.

The company is strong in Tier II and Tier III cities of South India. It runs Large Format Stores and Medium Format Stores. It follows an asset light model with backward integration, which means it makes a part of its own jewellery and keeps control on quality and stock. It also runs several jewellery saving schemes, which bring customers back to the store again and again.

As on 31 March 2026, the company had 7,059 employees working in sales, security, administration, back office and management roles.

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