RBZ Jewellers Limited (RBZJEWEL) Q2 2027 Earnings Call Transcript

Ladies and gentlemen, good day and welcome to Conference Call for discussion on unaudited financial results as on 30th September 2026 of RPZ Jewelers. As a reminder, all participants' lines will be in the listen-only mode and there will be an opportunity for you to ask questions after the presentation concludes. Should you need assistance during the conference call, please signal an operator by pressing star then zero on your touchstone phone. Please note, this conference is being recorded. I now hand the conference over to Ms. Ria Dharia from EY Investor Relations. Thank you and over to you, ma'am.

Thank you. Good afternoon to all the participants on the call. Welcome to the Q2 and H1 FY27 earnings call of RGZ Jewelers Limited. Before we proceed with the call, let me remind you that the discussion may contain forward-looking statements that may involve known or unknown risks, uncertainties, and other factors. It must be viewed in conjunction with our business risk that could cause future results, performance, or achievements to differ significantly from what is expressed or implied in such forward-looking statements. Please note that we have mailed the results and the same is available on the exchange. The investor presentation will be uploaded shortly. In case you have not received the same, you can write to us and we will be happy to send the same over to you. To take us through the results today and answer your questions, we have the management of RVZ dwellers represented by Mr. Harith Zavedi, Joint Managing Director and CFO, Mr. Harshit Gandhi, Internal Financial Controller, and Mr. Bhavesh Savnani, Senior Manager, Accounts and Finance. We will start the call with a brief overview of the quarter gone past and then conduct the Q&A session. With that, I hand over the call to the management. Over to you, sir.

Good evening, everyone, and thank you for joining us today for RBJ Jewelers Earnings Conference call to discuss our performance for second quarter and half yearly results of FY27. On behalf of the management, I extend a warm welcome to all the investors, analysts, and stakeholders participating in today's call. Before I take you through the financials and operational highlights for the quarter, I would like to briefly introduce our company for those who may be engaging with RVZ for the first time. RVZ Jewelers is one of India's leading gold organized manufacturers with a growing presence in retail jewelry segment. Over the years, we have built our business on three enduring pillars, trust, craftsmanship, and design. These principles have enabled us to forge lasting relationships with our customers, retail partners, and stakeholders, and continue to shape the way we grow and create long-term value. At the heart of our philosophy is an unwavering commitment to transparency, integrity, and strong governance. This is reflected across the way we conduct our business. At our retail business, Harit Zavari Jewelers, we follow strict, zero-cash transaction policy, ensuring transparency and traceability across every customer transaction. For us, trust extends well beyond the quality, purity, and craftsmanship of our jewelry. It is equally defined by the integrity of our practices, the professionalism of our conduct, and the responsibility with which we build our business. This principle remains fundamental to strengthening our brand, deepening stakeholder relationship, and creating sustainable value over the long term. As a registered company, we recognize that strong governance, transparency, and financial discipline are fundamental to building enduring stakeholder trust. We remain firmly committed to the highest standard of corporate governance, regulatory compliance, and ethical business conduct. Our ambition is to get recognized not only as a leading retail jewelry company, but as an institution distinguished by its integrity, transparency, and professionally managed operations, creating sustainable value for all stakeholders. As you are aware, RBSI Jewelers operates a distinctive and diversified business model with a presence across both manufacturing and retail. We cater to our leading national jewelry retailers through our wholesale and job work business, while also serving end consumer through our flagship retail brand, Harit Zabiri Jewelers. This integrated presence provides us with a deeper understanding of evolving consumer preference and market trends, while enabling us to participate in opportunities across multiple segments of the jewelry value chain. Our manufacturing capability remains. A key pillar of our competitive strength, our state-of-art manufacturing facility is equipped with advanced casting, laser, and 3D printed technologies, supported by a team of 200 plus professionals and approximately 250 skilled artisans. By combining modern manufacturing technology with generational craftsmanship, we are able to create jewelry that brings together precision, quality, and integrated design. Design is at the heart of our proposition and remains one of the key differentiators. We continue to invest in strengthening our in-house designs and product development capabilities, allowing us to create distinctive collections that seamlessly blend with traditional artistry and contemporary aesthetics. This design-led approach enabled us to stay relevant to evolving consumer preference, strengthening consumer engagement, and reinforce our competitive positioning. Our portfolio spends a wide range of jewellery categories, techniques, and price points addressing requirements across bridal, festive occasions, and everyday wear. We have developed particular expertise and recognition in antique gold bridal jewellery where our craftsmanship and design capabilities have helped establish a strong market position. Through Harid Zavri Jewelers, we complement this strength with comprehensive retail offering across gold, silver, studded, and other jewelry categories encompassing both traditional and contemporary designs. Looking ahead, retail expansion presents an important pillar of our next phase of growth. We intend to leverage a strong brand equity that Harid Zaviri Jewelers has built in Ahmedabad. To progressively deepen our presence across Gujarat, our focus is to strengthen our footprints within Ahmedabad, including East Ahmedabad, while selectively expanding into attractive markets as Gandhinagar and Rajkot. As a part of the strategy, we recently expanded our retail footprint with opening a new store in Suraj towards the end of September. This marked an important step in taking the Haritavari Jewelers brand beyond our established Ahmedabad market and strengthening our presence across key jewelry consumption centers in Gujarat. The store was inaugurated in presence of renowned actor Vicky Kaushal, with whom we have partnered to further strengthen the brand visibility and recall his strength. This strong, connected audience across age groups complements our efforts to build a more contemporary and aspirational identity for Harit Savoris. While retaining the trust, craftsmanship, and heritage that have always been at the core of our brand, together this initiative are aimed at building a strong consumer franchising. And supporting the next phase of growth for our retail business. Our approach to expansion will remain disciplined and measured with a focus on building sustainable store economics, strengthening brand visibility, and replicating the consumer trust we've established at our home market. Over time, we believe... This will enable us to build Harith Zabiri Jolaj into a stronger and more scalable retail franchise, complementing our established manufacturing capabilities and creating other meaningful avenues for long-term growth. Our long-term vision is to build Harib Zawiri Jewelers into a leading and trusted Indian jewelry brand known for distinctive design, superior craftsmanship, transparency, and exceptional customer experience. With our integrated manufacturing capabilities, strong design expertise, and expanding retail presence, we believe that we are well positioned to capture the growing shift towards organized jewelry and create sustainable long-term value for our stakeholders. With that, let me now take you through our financial operations performance for the quarter. We are pleased to report the healthy performance of quarter 2, financial 27, delivering a revenue growth in line with the guidance shared in previous quarter. For the quarter under review, we delivered strong revenue growth of 55% Y-on-Y to 225 crores, reflecting healthy demand and higher jewelry sales. EBITDA increased 3.5% Y-on-Y and INR to 29 crores, translating into healthy margins of 13%. Pat stood at 16 crores with a margin of 7.3%, lower to 12% Y1Y, primarily a count of in terms of segmental performance. We witnessed strong growth across all three business during the quarter. Retail crew at 72%, Y1Y 248 crores, continuing to be the key driver. Wholesale crew at 31%, and job work stood at approximately 3.3 crores. Growing at 19%. Overall, the quarter reflected healthy in broad-based growth across our diversified business model. During the quarter, we also strengthened our market presence through active participation in five major jewelry, exhibition, and trade shows in Saurastra region, North Gujarat, Ahmedabad, and key locations. This platform enabled us to showcase our latest collection, defense, engagement, and trade partners and enhance our reach among prospective customers. With that being said, I would like you to open the floor for question and answer session. Thank you, and over to you.

Thank you very much. We will now begin the question and answer session. Anyone who wishes to ask a question may press star and 1 on their touchstone telephone. If you wish to remove yourself from the question queue, you may press star and 2. Participants are requested to use handsets while asking a question. Ladies and gentlemen, we will wait for a moment while the question queue assembles. The first question is from the line of Shikhar from VWO Commercial Limited. Please go ahead.

Yeah, I just want to understand the margin drop year on year. So, how much of this is due to the gold prices which have been dropping recently, and how much is it due to the new expenses which have been, new expenses due to the store opening at the retail side?

So, hi, so if you would see, there is a, you're talking about gross margins or EBITDA level margins, you know, just to understand.

Gross margins as well as EBITDA, gross margins have decreased by, I think, 6%, if I'm not wrong, year on year. So, yeah, so is it, have we had some inventory loss also because the gold prices have been on a downtrend?

No, we right now have not got any inventory loss. The gross margins has declined. Yes, we had limited gold gain because, you know, this fiscal year we have understood that, you know, gold has not actually appreciated anyhow. So, in fact, gold has only got depreciated, but there has been inventory loss as of now. And on the side of, let's say, EBITDA level or PAT level, because of the store opening, which was done on the end of September, now there was an inventory buildup. So the finance cost has risen from 2.55 crores to 5.54 crores. So this was clearly due to the stock which was held with us. It got a bit delayed, and hence that inventory carrying cost is there, which was then in interest form. Other than that, the depreciation was also grown by around two and a half, three-folds, from 86 lakhs to 1.7 crores. And other expenses or one-time expenses of promotion have, you know, shot up by around 5-6 crores. Hence, you are able to see the cumulative effect of this goes down to the pad. If you neglect all of this, you will see that in normalcy, the company has done good at all levels. Considering the gross margin level, I would want to specify this point and highlight it that the B2B business in which the gold has been shifted from B2B to B2C and we have got payments to vendors, so a little bit of proportion of that is coming from sale of bullion also. Hence, the margin is lower.

Okay, got it, got it.

So, the 5 to 6 crore was a one-time expense, right?

5 to 6 crore was a one-time expense, finance cost, carrying cost for around 2 and a half, 24 September was the store opening. So, 25 September, we got the sales on. So, that 2 and a half months was actually a carrying cost we were expecting to have an opening a little before, hence.

Got it.

And for the new store, how has the response been? So it's been around, I think, more than 35 years since we have opened the store.

So how would you say the feedback or the response has been in these 35 days?

So we are averaging around 50 lakh rupees a sale a day, you know, and since, you know, it has been a Sharad period also, and then the Navaratri period, so cumulative, both there has been an upside also, and quite muted. So average, it's coming around 50 lakh rupees a day, more or less, it's an approximate that I'm discussing. So it has been a very warm response. In fact, you know, it is very optimistic, the whole team is very optimistic, and in the first month, if this is an average, it seems quite positive.

Got it. Thank you.

Thank you and all the best. Thank you.

Thank you. Next question is from the line of Sureshav from Nirmal Bhang. Please go ahead.

Hello, am I audible?

Yes, that's audible.

So, firstly, congratulations for the results. So, I wanted to understand what has been the volume split between B2B and B2C. Please start up.

Just a minute. The quarter-wise picture.

So, quarter 2 retail is 96 kg, wholesale is 47 kg, and job work is 219 kg. In total, it is 363.58.

Got it, got it. And secondly, what is the contribution of job work to the fact this quarter is the expense of the task?

No, we cannot clearly bifurcate that.

Okay. Last question. What is the exposure of GML currently?

Currently, we are around 14, 15 courses in GML. We are wanting to clearly lift that up around 14, 15 kgs right now in GML. But we want to lift that up to, you know, around 100 kg or so.

By this financial year?

By maybe this financial year or one more quarter, like, you know, yeah, by Q1 of fiscal 28.

Okay.

So, within six months, basically within six months.

Okay. Thank you.

That's all for myself. Thank you.

Thank you. Next question is from the line of Yash from Vyansh Ventures. Please go ahead.

I am Aodhul.

Yes, you are Aodhul.

So, I wanted to get a very specific answer on the new show that has opened up. And what I'm trying to understand is what exactly are the key metrics that you are measuring internally in terms of the outcomes from the store? And what kind of a break-even period are we looking at for this? And how does that story evolve?

So key metrics would be walk-in. That is footfalls, how, what footfalls are getting attracted, the conversion ratio, how many footfalls, and what amount of percentage conversion that we should be, we are able to convert whoever are coming. A third is sales, you know, and so generally these three are the matrices and, you know. Maybe we generally keep a check and understand how the sales, each salesperson also performs, you know, so that sometimes training and etc. is missing to the weaker ones and, you know, so that the ratio gets dipped. But generally, these are the three matrices and we want to understand the three matrices more better. Who are coming to us, who people are getting converted, and what amount of sales they're generating, and obviously the ticket size.

Okay, and just to follow up to that, what's the plan of action now with the store expansion thought process? So, I missed the metrics that you're now tracking. So, if I take that one step forward and I try to understand the achievement time period for this, what kind of an internal timeline have you set to achieve the store level breakeven? And what happens when we reach that breakeven? Do we plan expansion before that or do we plan expansion after that?

Capex, we will be baking even in maximum one year.

Okay.

So, inventory and all plays a huge chunk. So, in large permits, so typical inventory size is 150 crores. So, you know, capex is around, let's say, 10, 12, 15 crores.

Okay, so when you say capex break-even, you will include inventory also? capex break-even doesn't include inventory. Okay, so inventory is, and what kind of a turns are you expecting from the store?

In the, on the mature store, around two and a half turns is what we expect. Currently, on a TTM level, we should be doing around one turn, and then it should be 1.75, and then 2.25, something like that we are. I have no understanding, but these are just, you know, forward-looking things. So, you know, I think right now what we have got a response is around 50 lakhs a day average we are clicking in the month of October. So, that is what we can rely on.

Okay. Thanks so much, and best wishes for the future. Thank you.

Thank you. Next question is from the line of Sora from VT Capital Market Private Limited. Please go ahead.

Hello, your auditor?

Yes, your auditor.

Hello.

Last one. As the company increasing that switch towards the B2C business model, sir, then what will be your long-term addition for 2030 in terms of store-down?

So, by 2030, I think, this year we are adding four stores. By next year, we should be again. You know, there are stone which are lined up. I think we should be one of the leading brands in Gujarat and should out come in a very, you know, as a zonal brand also. So, yeah, we are all in for retail expansion.

I'm understanding that it was in a retail expansion, but in your mind, just think of... Number of store count you are going to open by 2030. I'm not asking for any guidance, but just your vision that number of stores you want to see at 2030.

So, I can tell you that when I'm saying that we want to be the largest, you know, one of the largest in Gujarat and perhaps West also, then, you know, our peer store count, you can actually measure and you can understand that what is the kind of store that we would be wanting to open. And also, typically, it should be backed by, you know, funding and all. So, currently, you can say that you can expect around three, four store opening every year. I really don't have the data because right now in retail, you know, there is no listed company especially in Gujarat. So I don't have data in my hand for that. But we think that there's a lot of white space. In Gujarat, and we think that on the sides of retail, we can really have a good run when it comes to this market.

And so what will be our margin sustainability in terms of EBITDA and in terms of fat margin which are short expansion?

So, see, once there are large format stores in place, you know, then you typically, you don't need to see this is a period in which we really want to invest in brand because if you want to take a route of franchisee or anything like that, brand becomes very important. Hence, when you are talking about F530 or I'm not able to give you a concrete kind of a number because we still, you know, we are figuring out about the franchisee route, the brand route and all. But yes. Certainly, there's a lot of discipline and work that we are putting on. Let us understand how we see, you know, but as far as the store expansion and margin plays are concerned, these are the, see, given that the job work and all will remain to this thing, to the 50% level, the margins are healthy and stable only. It can differ from Q on Q, but more or less on an annual level, it will come across same. Now, once the retail expansion is taken, it will be more, from the gross value merchandise, retail will have a better margin than job work, but from the overall perspective, there will be a little bit of margin depth, because again, service charge, if we are merely putting service charge into place, we get a good, healthy margin.

So, in consolidated level, we can sustain 11 to 12 percent of the margin.

So, on a consolidated level, yes, if the services remain same, we can sustain that. We have been sustaining that since now three years, right?

Thank you.

Thank you. Next question is from the line of Mihir Desai from Desai Investments. Please go ahead.

Thank you for giving me the opportunity. So, firstly, I just wanted to understand on a long-term strategy, like how are you planning your business in terms of going into retail or B2B? I am asking this question because, sir, currently, if I see the job work is, you know, on a higher side of our business, and I believe that their margins also would be lower than compared to the retail. So, how are you planning in the long term to take your business?

So, in long term, because in B2C, we see scalability. And job work and all currently does, you know, last year we did around 550 kg of job work. And this year also we have done a good amount of job work, like, you know, total 219 kg of job work. But we see that there can be a lot of scale achieved in B2C. And the profit is also better in retail. So, you can understand the company from the manufacturing to retail side as a, you know, from the segment, but not, but mainly you should focus on the B2C side of the business. That is where the key growth is going to come. Okay.

And so, the follow-up on this is that can you give a roadmap or thought process of how the management is thinking about panning the company in that shape?

So, we are, so, it is by expanding our footprints, be it company-owned stores or franchisee stores. We are aggressively doing it in Gujarat, and now we want to go out of Gujarat and do it maybe in other states. But basically, this is the retail things will, the retail thing will lead.

Okay, okay, understood. And, so. So, how should we distinguish ourselves from others? So, say for currently where the B2C players are there, so there is a lot of competition and there are too many players. So, how do you differentiate yourself, particularly, you know, your brand? So, how do you look at the company? So, just wanted to understand on that.

So, from the tangible and intangible perspective, or tangibly, when you experience the store visit, you will understand it way better. You know, many of the investors who might be asking questions have already done a store visit. And once you see that, okay, when you visit the store, you should feel that tangibly different, distinctive. And if you don't have the sense of that, you know, we can talk to other things. But I really believe that you are asking a relevant question and that store visit for you will be asked for actually understanding those perspectives. Sure.

Sure, sir. If I have a few follow-ups, I'll get that. Yeah, sure.

Thank you. A reminder to all the participants, anyone who wishes to ask a question may press star and 1 on their touchtone telephone. Next question is from the line of Gaurav Agarwal from 9-1 Capital. Please go ahead.

Good evening, Harit Bhai. Thank you so much for taking my questions. And congratulations on good results for opening your new showroom. So, just one clarification on the gross margin side. If you were to take one showroom and see on a blended basis, what kind of gross margin do we make or do we expect to make?

So, we're on. 2% or so should be the gross margin mix. Now, depending on the store somewhere, the strut ratios are high and strut, sometimes the strut ratios are low. But typically, you can take in the average around 14 odd percent.

And this 14%, you know, is it like the lower end of it or is it from range, upper end, like any contact care? Like we take it from 14 to 16?

Yes. Yeah, so you can take the range, but, you know, the 14 is being realistic about it, and I think if the studied ratios are high, then we can go to 16%, but 14% is something that, yes, we should be able to. Also, from the manufacturing side, if we put in more of the manufactured products into the thing, then the margin can really go good. So, yeah.

Correct, correct. And typically for these new showrooms, what is the year one inventory turnover you are expecting in this case?

So year one inventory turnover is something around 1.2 is what we are anticipating. And by the end of three years, it should be 2 to 2.5 tons. And that should place our store anywhere in the top three or four stores. In the city that we are entering. And we are seeing the same kind of response that, you know, in the Surat store as well. You know, clocking a ton of around, you know, 15 crores or so in the first month itself is quite... Quite strong. Now, this is excluding the bullion and the coin sale. This is purely the jewelry sales that I'm talking about, clocking 50 lakh rupees. So, that seems to be very encouraging.

And, you know, it might be a bit early to ask this, but in the Navratra season, how was the experience in Surat versus your already wish family?

The walk-ins were quite encouraging, and even in Surat, now because it's a first store and there is no legacy or something like that, we have had a little bit of challenges facing the convert. But the experience has been very warm. The consumer understands and distinks. You know, when the customer enters the store, there is a clear, distinct brand identity that we have built. Hence, the confidence is high. The average ticket size is also good. We are having around 3.5 lakh to 4 lakh rupees of average ticket size. So, overall, the experience has been very nice. See, with no discount, no bargain, and, you know, no advertising of any tricks and stuff, we are able to block 50 lakh rupees is a good stage. That is what we internally discuss.

Yeah, you're saying 50, right? Five, zero.

Five, zero, 50. 50 likes.

That's very, very. You know, I think this is a late start to our retail expansion journey. Our best uses for this and speak to you, you know, soon. Thank you so much. Thank you.

Thank you. Next question is from the line of Moks from Aurum Edge. Please go ahead.

Hello, sir. You mentioned in the opening remarks that margins were a bit lower due to basically inventory, a little bit inventory losses. So, could you quantify that?

So, there is no inventory loss. What I have specifically said is that there is no inventory gain, not much of inventory gain. So, okay, and I have also specified the other thing is there is a good amount of bullion sales. That is because of the shift. Okay, so when we do retail, we tend to buy a lot of goods from other vendors. When we need to pay to them, we pay via gold that we have. Let's say 10 kg has been bought. So let's say I can pay 8 kg by gold. Why I do that is because I have transferred stock from B to B to B to C. So, you know, there's an excess stock in B2B. If I have transferred in B2C and paid to my vendors, and I'm opening a store, that is how the capital allocation has gone. And hence, you are able to see that there is zero amount of, you know, profit in this Boolean and all. So, hence, you know, the gross margins have got an effect of drop over there.

Okay, and considering the increasing store, the more number of stores we are planning to add, we expect our gross prices to essentially increase, right?

No, this is the gross margin. If the studied ratio increases, the gross margin will increase in the retail segment, yes.

Oh, got it, got it.

Thank you. Next question is from the line of Saurabh from Fires Asset Management. Please go ahead.

Yeah, good evening, Harit Bhai. Two questions from my end. One is on the retail revenues for the quarter. I just want to understand what is causing the sharp uptick in these numbers because Surat came in at the very end of the quarter. So that is question one. And second is, can you tell us a little bit about what kind of branding, marketing expenses you are budgeting on an ongoing basis for the next one or two years as the new stores come online?

So, we are expecting around 20 to 25 crore rupees of marketing as an expense because of new stores, rollouts, and, you know, if there is a typical last format store, we would really have to have a celebrity for a store launch, you know. Let's say that 2025 crores is at least this year planned. On the higher side, it's basically 25 crores or so. And because there will be... Yeah, the brand is actually becoming more stronger, and we are able to see that the same store sales growth is also quite promising. But again, as a result, this is for the first half of the year, right? The second half of the year is still pending. So, we would want to see and understand it from the whole year perspective. You know, see, this Amdabar store we have been handling, and now that has been going good. But what we are really excited about is the store. That is going good. That should go. That part is very exciting. It is already doing somewhere around half of what Endava store is doing now. On a three basis.

Okay, so the entire uptick for the quarter is coming from the first, from the Ahmedabad store.

Yeah, from the Ahmedabad store, but a good amount of that is bullion also. So, we have to pay to the vendor, we have taken the metal from B to B of our side, and then we have paid to the B to C part. So, then the payment has also gone bullion phase, and that is why you are able to see that margin shrinkage is there. So, we can neutralize that part. But Scott, there's a very healthy same store sales growth if it is, you know, roughly, would you mind disclosing the figure, any rough figure? Currently, we don't have an exact figure in hand and hence I'm not able to disclose that. But what we see is that the first half of retail has been pretty strong, like very, very strong. Hence this figure. But the sale has also played its part. Okay. Got it.

Thank you so much.

Thank you. Next question is from the line of Rishabh from Nirmal Baan. Please go ahead.

Hello, am I audible?

Yes, Nirmal.

Thank you for having me again. So I wanted to understand, particularly for the Surat store, because we have a separate floor for the lightweight or the low carriage segment. So is that segment also doing good in Surat? Or is it just the pesky sales that is driving the Surat sales currently?

So, occasion wear and daily wear both are doing good in sewer as of now. Occasion wear is surely a leader, but in daily wear, we are getting a good, you know, we are getting a good demand from even shredded jewelry part. So, yeah, I think overall store is doing nice in both the segments.

Okay, okay. And how is the progress going on for the future two stores that are Rajkot and Jamal?

So, Rajkot is pretty much we are launching in the third or the fourth week of November. That is November 21. To November 25th, somewhere in that range. But surely, you know, we will be concluding in that because store handover will happen in more or less another six, seven days, and then the Diwali days comes, you know, the off days and all. So we are all prepared to launch Rajkot as soon as we can. Basically, in November, from November, you can say 21 to 25. And Maninagar and Kandhinagar will be in the month of December and January.

Okay, okay. So, are we in any agreement with any salubrity or so on the Rajkot Open?

Currently, we are, you know, once, currently, I think we are in talk with you, but let us finalize and freeze up to one.

Okay, and I just wanted to understand more, just wanted to get more clarity on the Boolean part that you said, that you get the word from B to B to B to C, so can you just give more clarity on that side?

See, there is a Boolean sale, but it has not, see retail has done extremely well among all the three. things, be it wholesale, job work, or, you know, the third segment, has been the leader in terms of driver and the upside. But surely, you know, bullion sale, when I say it has its part, that means that the gross margin has gone down. And one of the reasons the gross margin has gone down is because the bullion sale is high. And, you know, obviously, there is very, very negligible amount of inventory gain, right? Because You know, the gold prices have dipped and all. So, currently, what we are understanding is there is a part of bullion sale, which is there because it has shifted from manufacturing to retail, and we have done payments via bullion. But that does not take that, you know, retail has performed in any way, which is less than the average or whatever. It has outperformed at least the wholesale numbers. The wholesale numbers are 31%. So, bullion is, retail segment has performed at least more than, I think, I don't want to quote the percentage, but it has performed very nicely. So, I don't have numbers in hand, hence I am not able to quote the bullion sales, but, yeah.

Okay. Thank you, and best of luck for the future.

Thank you.

Thank you. Next question is from the line of Oma, an individual investor. Please go ahead.

Congratulations on a good set of numbers. My first question is on GML loans. GML loans are merely 6 to 6.5% of total borrowings. As you indicated, is management facing any challenge for obtaining this facility? Because I want to know on perspective of interest costs, because GML loans is... As per economics, it will be beneficial for the company in saving interest first. Can you just write me or any comment on that?

Yeah, Harshit will be here for that.

So, yes, you rightly mentioned that from the finance cost perspective, the GML is also one of the effective tool. And also from aging perspective, it is also an effective tool. So, yes, we are evaluating that and gradually we are in the favor of increasing this proportion, wherein we can utilize the benefits of not only the finance cost, but also as a part of the aging tool. Good morning, everyone.

So, actually, one follow-up question only on that. As management indicated, we are planning four new stores, okay? So, there will be a lot of requirement of inventory. And yes, it is a commendable thing that receivables are converting in cash, but simultaneously, we are increasing in inventory also. So, in future or in coming time, we will be having a requirement of capital, right? So, are we still relied on cash credit facility? And you now indicated that GML we are exploring. So, is the proportion of GML will be increasing from here?

So, basically, GML is nothing but a part of the working capital. So, in a way of working capital, we are, you know, evaluating from the lenders itself to give us a measure in form of the GML. Yes, of course, the certain limits are in form of CC limits. So, not all the lenders per se that they are giving the, you know, offering the GML as a product. But those who are giving, we are gaining on the higher side in the form of GML limits.

So, any guidance regarding how much will be in terms of total borrowing GML component?

So, for example, as against our total borrowing, let's say it is, for example, near 2-3%. And so, we are evaluating that how. Considering the scenario of the gold price, how we can increase it, and how we can take the benefit. So, it will be evaluated on month-on-month basis, and eventually you can see in our books also in upcoming quarters.

The purpose was only for asking if we increase that component, it will be really beneficial for shareholders on a return on capital. So nothing more than that. Okay, thank you. Thank you.

Thank you. Next question is from the line of Isha Shah, an individual investor. Please go ahead. Hi, sir.

Thank you for the opportunity. Sir, what gives you confidence that RBZ's success in Ahmedabad market can be replicated in new cities? And what are the only learnings are you seeing from Surat?

So, I think the demographic remains the same. You know, we have understood the market very, very... You know, rigorously. RBZ has a experience of dealing in wholesale and manufacturing jewelry for now about 20 years. We deal in jewelry with 72 cities, in 72 cities, in 300 mom-and-pop stores and with almost all the major corporates. We understand merchandise of each region very, very, you know, deeply. Please do not see the company that it is just a new company entering into a market. We have had a lot of back, you know, backup set of 20 years that, you know, we understand jewelry and its regional choices. Hence, when we enter a city, be it Surat or so, we are able to see it. So, you know, a very fast response.

Thank you, sir. And how do you see sharp moments in gold prices affect customer demand, volumes, ticket size, and margins?

I think now the gold jewelry buyers are also very much, you know, they are also aligned to how this gold volatility is. When there is too much of spike or there is too much of, you know, lows, people generally do not come to a decision-making thing. They generally hold, and we have been seeing this quite often. I think the behavior gets normalized within a week or so. With respect to margins, I don't want to comment anything because it is too short-term. You know, normalized margins, you can actually see in the financial figures only.

Okay, sir. Thank you so much and good luck for your new stories.

Thank you.

Thank you. Next question is from the line of Dipesh from Marnia Finance. Please go ahead.

So, Haruki, am I audible? Yes, yes.

I just wanted to understand, what is the timeline? I joined in late, so if you can excuse me that I am asking any repeated questions. What is the timeline for the longest of the Rajkot showroom?

It's November 21 to November 25 is the timeline for launch of Rajkot store. And Madinagar, we are hoping in December and Gandhinagar in January.

Okay. And you had mentioned that, or it was your plan that you're going to convert most of your inventory into gold load. Is that on track? Have we done this in this quarter, anything? Or for this year, at least for F527, do we have anything in mind?

So for, till F527, I think, or within next two quarters, that is within next six months, let's say, by the end of, let's say, next year quarter one earnings call, we should be able to at least do 100 to 150 crores of minimum GML. That means, you know, 100 kg plus of GML will be there. Within maximum of the period of two, two and a half years, a complete inventory should be hedged. And that is in clear minds. We have no two ways about it now.

So the money which will be coming from the inventory sale will be going into debt reduction?

No, it will be money which will be coming in. It will be actually going into, you know, payment of GML and then taking the GML again. It is just going to be a cycle. Inventory levels are not going to be low in any case. In fact, we will have an opportunity to take more debt. Because, you know, of the lower interest rate that we'll be having. GML generally is typically three and a half, 4%, and CC is 9%. So we can actually get up with, you know, one more time of data. So two is to one can be the data issue in this case, which will have us more stores in.

Right. So, I mean, definitely that will help the ROE a lot. But just wanted to understand, if we are reducing our inventory, then most of them, I mean, a lot of money comes in because I'm sure that, you know, you had planned this when the goal was at 1,60,000. I mean, and it has come down significantly. So, you had that vision. So, I just want to understand that if you're reducing the inventory, that money would significantly come into the books, right? And that money will be only for GML increase. So you're going to increase your inventory from here maybe to 2x. Is that the right understanding?

I think, yes, that's the right understanding. First thing, inventory increase will happen. But I don't get your first part. When you say that there will be an inventory decrease, do you mean to say in the manufacturing line or in the B2B segment, or do you mean to say into a particular store? I don't understand that part, but overall, when you say that there will be a double inventory.

The unhedged inventory would go... Oh, unhedged inventory will be...

Correct, correct. Unhedged inventory will be almost down to, in the next two years, will be down to zero, or more or less, you know, a very low part of it. And unhedged inventory, in the percentage from every year, will continuously go to lower levels.

Okay, and if you can also give the outlook for gold prices, because I mean, you had been right at the last quarter, so I just want to understand your outlook for gold prices, and because of that, is that the reason you're doing this, or completely moving to hedge investment?

No, frankly saying, hedging will be the right practice to do because, you know, we have high predictability in terms of P&R financials. Unhedged inventory, there is no problem with unhedged inventory, you know, when you don't want to predict profits, but in a long-term way, both of them gels well together. You know, see, gold as a commodity moves at around 13% per annum, but, you know, it gets dissected into three segments, custom duty, dollar appreciation, and gold as a commodity. Gold as a commodity on a long-term level moves around 7%, custom duty, you know, maybe at around 6% to 15%, it floats, and dollar appreciates around 6%. So, in the GML, we only hedge gold as a commodity. So, and we get a benefit of loss of 7% and a benefit of 5%. So, it's a good trade-off, and it gives predictability. I don't think there's any issue with the... You know, GML, perhaps you can get more visibility of stores because we can have the same amount of interest payout, we can have double the amount of working capital with us. I think that is more better on the sides of store expansion and etc.

Right, right. I mean, going the Titan model, that will be, I mean, great for the shareholder return. Also, just one question. What is the focus of the company right now? Is it more on the retail side or are we going to, I mean, how are we going to do our B2B? Are we going to maintain it or slowly we are going to, you know, use the focus or reduce the, what is the outlook of the company?

So, we will remain.

Yes, B2B will remain stable. There will be no signs of decline if you understand from the gross value of merchandise, but B2C is where you will see a primary kick-in will happen, the growth will happen.

Right. All the very best, sir, and great to have a conversation with you again. Thank you. Thank you.

Thank you. Ladies and gentlemen, in order to ensure that the management is able to address questions from all the participants, please limit your questions to one per participant. Next question is from the line of Meet Mehta and Individual Investors. Please go ahead.

Yeah, all my questions have been answered. Thank you very much.

Thank you. Next question is from the line of Rochit Shah, an individual investor. Please go ahead.

Hello, am I audible?

Yes, audible.

Harit, congratulations for the retail workup. I had a couple of questions. So, first of all, just clarify the wholesale and job work business. We should be looking from the... Quantity, like the volume perspective, right, rather than the GMV that was just mentioned?

No, GMV will be the right way to look at business.

For job work as well?

In fact, with job work, it becomes more relevant. See, when you don't take GMV into the picture, the best will be the volume data. But that will be a second option. GMV anyways will be the number one option. Gross value merchandise is the right option to look at the business. And in gross value of merchandise also, being very clear, job work will have less margins, wholesale will have better margins than job work, and retail will have the best margins among all the three together.

Yes, yes. So, as the question was, because there was a slight dip in the volume in terms of KPIs with respect to job work and wholesale. So, I was just looking to check, like, has there been increased competitor intensity or something?

Nothing because of that like that. It is just a shift of season from September 22nd to October 11th. Navratri has shifted 20 days. And hence, you are not able to figure out, you know, get that figures on hold. When we see October, it is in complete normalcy.

Okay, but usually job work would be in advance, right?

Correct, in advance, but you know, they also want to have their things built up during Diwali, right, during Navratra. So Navratra getting postponed means our deliveries will also get shifted a bit. Now, when I say that 363 is a total volume and 219 contributes to job work, in October month last year, let's say, just to give an example, let's say October last year, it will be around, let's say, 50 kgs. So this will be around 100 gauges. Just because of the shift in that last year, you don't expect October to be much higher because Navratri was in September 22, and people would want to have orders fulfilled before Navratri or before one day of Navratri or whatsoever. So, dispatchment can happen. Similarly, in wholesale, right now, October has been Novratri. So, we see that deliveries will be getting, you know, finished in the month of Novratri itself. So, just a little bit of shift is there. Hence, you are seeing that little dip in the volumes. Other than that, the business is at complete normalcy when you check the October numbers. I think best will be Q3. Q3, you know, will give you much better clarity, you know, where are these headings. Again, in the gross value of merchandise, if you calculate, you know, last year, first half versus this year, first half, the GMB will surely increase.

Understood, Havit. Thanks, that's helpful. A couple of other questions was, firstly, broadly looking at retail, so BF had one week of... During that week also. So broadly, it would likely have done like two. Using that, we would get like 95 kg as the retail volume. So that would be compared, directly comparable to the 80 kg of last year. Is that broadly right? Of course, there might be some variation in the number, smaller.

No, no, I'm sorry. Can you repeat that part again? I'm sorry. I just missed maybe a bit.

Okay. Last year, we had 80 kgs, and this year, it is 96.7. So, broadly, it seems like one week of Suraj would have done 2 kgs, considering your normal realizations that you have mentioned. So, broadly, the same store safe growth could be from 80 to 95. Would that be comparable? Right?

Correct. It is comparable.

On the last meet was Rajkot. I understood that we were earlier looking at Navratri, but it has been delayed to Diwali. So now we like him with Diwali as well. Correct. Has there been any specific concern?

No, no, no specific concern. It is actually, you know, these are large format stores, and, you know, there's a lot of, I, even, you know, we wanted to be in October 24 types, because at least we would not miss, you know, season or so, but fine, now we are missing that season, but still, you know, the encouraging part is that Surat is doing pretty well. In fact, very, very nicely. You know, we have got a very warm response. And also, the whole model of showroom is getting changed, right? The whole experience of the customer is getting changed when they're coming to a new store now, especially the store that we have made. I don't know whether you have come to... I did. I did. Great.

It was a very nice experience, yes.

Yeah, so that is it. Hence, the Rajkot thing also. Rajkot is actually a couple of thousand square feet more than Surat, and it's a three-floor store, so it's taking a bit of time. They had committed us to open the store on November 1st, but then we thought that November 1st would not make sense. Hence, we can do it maybe in the third week of November. That is what the plan is. But yeah, we missed that Diwali part.

Okay, Harid. Best of luck for the store opening and looking forward to more updates.

Thank you. Sure. Thank you. Thank you.

Thank you. That was the last question for today. I now hand the conference over to the management for closing comments.

Thank you, everyone, for the questions and interest that you have shown. In any case, if you have more queries, you can connect A&Y, our investor relationship partner. And thank you again to A&Y for conducting this call and course. Thank you all.

Thank you. On behalf of RVZ Jewelers Limited, that concludes this conference. Thank you for joining us and you may now disconnect your lines.