Senco Gold share price jumps 12% to record high as Emkay Global raises target; stock up 30% in one week

livemint.com:

₹1,065.65 apiece on the BSE. Senco Gold, the pan-India jewelry retailer, reported 39% year-on-year (YoY) revenue growth in the fourth quarter of FY24. For the entire fiscal year, the revenue growth was 28% YoY.

The company achieved volume growth of 13% in gold and 19% growth in diamond volumes compared to the previous fiscal year. The Same Store Sales Growth (SSSG) during FY24 was 19% out of retail sales growth and 23% out of the total 30% retail sales growth during Q4. Senco Gold shares reacted positively to the strong Q4 update and the stock jumped 18.59% on Monday.

In one week, Senco Gold shares have spiked over 30%. Read here: Senco Gold shares jump 19.5% to all-time high on strong Q4 business update Analysts at Emkay Global Financial Services believe even after the strong run-up in Senco Gold share price, valuations are at a significant discount to listed jewelry peers, despite its resilient growth execution historically and similar medium-term growth prospects. “An increasing studded mix should add to our estimate of ~20% topline growth and help deliver 23% and 27% EBITDA and PAT CAGR over FY24-26E," said Devanshu Bansal, Research Analyst at Emkay Global Financial Services.

Despite similar growth prospects and return profile, Senco trades at a ~35% discount to Kalyan which is unwarranted; we believe strong execution/delivery should continue driving a re-rating going ahead, Bansal added. Emkay Global maintained its ‘Buy’ rating on the stock and raised Senco Gold share price target by 19% to ₹1,100 per share, on the back of the 2-3% EPS change and 15% increase in its target price multiple to 29x FY26E EPS. The new target price implies an upside potential of over 15% from Monday’s closing price.