Synopsis: PC Jeweller’s profitability stands out with a 22 percent EBITDA margin and 25.45 percent net margin, far ahead of peers’ single-digit margins, driven by in-house manufacturing, premium jewellery mix, and sharp debt reduction.
In a jewellery market marked by intense competition, volatile gold prices and tight consumer spending, PC Jeweller’s margin profile has increasingly stood out from the rest of the industry. While many organised and unorganised players struggle with thin spreads and high working capital costs, the company has managed to protect and, at times, outperform peers on profitability metrics. This divergence has drawn investor and analyst attention, raising a key question for the sector: what structural and operational factors enable PC Jeweller to sustain higher margins compared to its competitors?
PC Jeweller Limited, with a market capitalization of Rs. 7,526.36 crore, closed at Rs. 10.27 per equity share, up by 1.48 percent from its previous day’s close price of Rs. 10.12 per equity share.
Incorporated in 2005, PC Jeweller Limited is an India-based jewellery company engaged in the manufacturing, trading and retailing of gold, diamond and silver jewellery, along with precious stones and gold- and diamond-studded products. Headquartered in New Delhi, the company offers a wide range of designs including rings, earrings, pendants, chains, bracelets, bangles, necklaces, mangalsutras, nose pins and men’s jewellery. PC Jeweller reaches customers through a network of company-owned showrooms, franchise outlets and online platforms, and also exports its jewellery to overseas markets.
Financial Performance
Revenue for Q2 FY26 stood at Rs. 825 crore, marking a strong 63.4 percent YoY growth compared to Rs. 505 crore in Q2 FY25, driven by robust business momentum. On a QoQ basis, revenue increased 13.8 percent from Rs. 725 crore in Q1 FY26, indicating sequential improvement and sustained demand traction.
EBITDA in Q2 FY26 rose sharply to Rs. 178 crore, registering an exceptional 107.0 percent YoY growth over Rs. 86 crore in Q2 FY25, while QoQ growth stood at a healthy 40.2 percent compared to Rs. 127 crore in Q1 FY26, reflecting significant operating leverage. Profit after tax came in at Rs. 210 crore, up 17.3 percent YoY from Rs. 179 crore and 29.6 percent QoQ from Rs. 162 crore, highlighting improved profitability alongside strong operational performance.
Over the past five years, the company has demonstrated a revenue CAGR of -15 percent, a profit CAGR of 48 percent and a price CAGR of 30 percent, reflecting both its operational performance and market confidence.
A return on equity (ROE) of about 12.7 percent and a return on capital employed (ROCE) of about 6.55 percent and debt to equity ratio at 0.22, demonstrate the company’s financial position. At the moment, the company’s P/E ratio is 12.3x lower as compared to its industry P/E 24x.
Margin Comparison
PC Jeweller stands out sharply on profitability metrics compared to other listed jewellery players. Its EBITDA margin of 22 percent is far superior to Kalyan Jewellers at 6 percent, Titan at 9.11 percent, Thangamayil Jewellery at 6 percent, and P N Gadgil Jewellers at 5 percent.
This strength flows through to the bottom line as well, with PC Jeweller reporting a net profit margin of 25.45 percent, while peers like Kalyan (3.32 percent), Thangamayil (3.45 percent), and P N Gadgil (3.62 percent) operate at low single-digit net margins. The gap is structural rather than cyclical and is driven by a few key business model advantages.
Own Manufacturing Facilities
One of the most important margin drivers for PC Jeweller is its own manufacturing capability. While the company does source jewellery through job work from skilled and experienced artisans (karigars), it also manufactures a meaningful portion of its jewellery at company-owned manufacturing facilities.
This hybrid model allows PC Jeweller to optimise costs, exercise better control over wastage, timelines, and quality, and retain a larger share of the making margin. In contrast, many peers rely almost entirely on third-party contract manufacturers, where a significant portion of the value addition is passed on as making charges, structurally capping margins.
In-House Design Capabilities
PC Jeweller’s in-house design capabilities further strengthen profitability. Because designs are developed internally, the company does not need to share design value or intellectual input with contracted artisans. In most jewellery companies, especially those following a contract-manufacturing-heavy model, designs and prototypes are often created by local artisans or external vendors, which increases overall production cost.
PC Jeweller, by keeping design in-house and combining it with its own manufacturing, is able to capture the full making charge benefit, a key reason for its superior EBITDA margin compared to peers like Kalyan, Thangamayil, and PN Gadgil.
Diamond and Studded Jewellery
PC Jeweller also benefits from a higher mix of diamond-studded and premium jewellery, which inherently carries higher gross margins than plain gold jewellery. Studded jewellery allows for greater design innovation, premium pricing, and higher value addition per gram, unlike plain gold jewellery where margins are largely limited to making charges.
Debt Reduction
Another major contributor to PC Jeweller’s unusually high net profit margin is its aggressive debt reduction. The company reduced its debt from approximately Rs. 4,150 crore in FY24 to about Rs. 1,594 crore by September 2025, significantly lowering interest costs. With finance expenses coming down sharply, a larger portion of operating profit now flows directly to the bottom line. Moreover, the company has articulated a clear target of becoming debt-free by the end of FY26, which, if achieved, could structurally sustain higher net margins compared to leveraged peers.
Shareholding Pattern
As of Q2 FY26, the company’s shareholding pattern reflects a balanced ownership structure, with promoters holding 37.61 percent, indicating continued commitment and control in strategic decision-making. Foreign Institutional Investors (FIIs) hold 6.46 percent, while Domestic Institutional Investors (DIIs) account for 8.23 percent, highlighting moderate institutional participation. The public shareholding stands at 47.7 percent, providing healthy liquidity in the stock and a broad retail investor base.
In summary, PC Jeweller’s margin superiority is not accidental. It is driven by own manufacturing facilities, in-house design capabilities, meaningful debt reduction, and a higher share of diamond-studded jewellery. While peers may use artisans as well, PC Jeweller retains a larger portion of the value chain, avoids sharing making and design margins, and benefits from lower finance costs, resulting in structurally higher EBITDA and net profit margins compared to other organised jewellery players.
Disclaimer: The views and investment tips expressed by investment experts/broking houses/rating agencies on tradebrains.in are their own, and not that of the website or its management. Investing in equities poses a risk of financial losses. Investors must therefore exercise due caution while investing or trading in stocks. Trade Brains Technologies Private Limited or the author are not liable for any losses caused as a result of the decision based on this article. Please consult your investment advisor before investing.
