Senco Gold Q1 2026 sales rise, shares drop on margin concerns

Senco Gold & Diamonds Ltd. reported a rise in first-quarter sales for fiscal 2026 on Monday, though its shares fell after the company flagged margin compression amid rising costs.

The Kolkata-based jeweler, which operates a chain of retail outlets across India, said consolidated net sales increased 15% year-over-year to ₹12.4 billion ($148 million) in the three months ended June 30, 2025. Revenue growth was driven by higher demand for gold and diamond jewelry during the festive season, the company said in a regulatory filing.

Despite the sales uptick, Senco Gold’s shares fell 3.2% to ₹1,120 apiece on the National Stock Exchange, underperforming the broader market. Investors cited concerns over shrinking gross margins, which narrowed to 18.7% from 20.1% in the same period last year. The company attributed the decline to elevated raw material costs, particularly gold, and higher operational expenses.

Management highlighted that while demand remained robust, pricing power had been constrained by competitive pressures in the domestic market. Senco Gold also noted a 5% rise in operating expenses, primarily due to increased marketing and distribution costs.

Analysts at local brokerage firms suggested the margin squeeze could persist in the near term, given the volatility in gold prices and ongoing cost inflation. However, they maintained a positive outlook on the company’s long-term growth potential, citing its expanding retail network and brand recognition in eastern India.

Senco Gold did not provide full-year guidance but reiterated its focus on cost optimization and premium product offerings to mitigate margin pressures.