As of January 26, 2026, Sky Gold & Diamonds (ticker: SKYG) trades around ₹301–₹303 on the BSE and NSE, facing a recent dip of about 3–3.5% from levels above ₹312 (investing.com). The stock’s 52-week range spans approximately ₹246 to ₹404, highlighting its considerable volatility (investing.com). Technical indicators suggest the share price currently sits below both the 50- and 200-day moving averages, reflecting potential short-term bearish pressure (trendlyne.com).
Financial Performance & Growth Momentum
Q1 FY26 Earnings Boost
The latest quarterly results show a sharp financial recovery. Q1 FY26 revenues surged nearly 56% year-over-year to around ₹1,131 crore, accompanied by a more than two-fold increase in net profit to ₹43.6 crore. EBITDA expanded over 90%, with margin improvements reinforcing the company's strong execution and cost efficiencies (ndtvprofit.com).
Q2 FY26 Highlights
The momentum continued into Q2, with revenue growth close to 93% YoY reaching ₹1,484 crore and profit up about 82% year-over-year. The firm ramped up production, diversified its product mix with 18K gold contributing a meaningful portion of sales, doubled exports, and pursued strategic acquisitions and global expansion—especially notable was the entry into the Dubai B2B market and acquisitions like Speed Bangle and Shri Rishab Gold (scanx.trade).
Strategic Moves & Expansion Strategy
Recent strategic developments reflect a clear ambition to scale. Nuvama Institutional initiated coverage with a 'Buy' rating and ₹450 target—implying roughly 30% upside from the current share price (business-standard.com). The company also completed acquisitions, including a 51% stake in Shri Rishab and arm’s acquisitions to expand manufacturing and distribution footprint (business-standard.com).
A major milestone includes the full acquisition of Ganna N Gold via a ₹225 crore share-swap, expanding Sky Gold’s product range and helping it capture more of India’s jewellery market (angelone.in).
Balance Sheet & Risk Factors
Despite strong top-line growth, Sky Gold faces persistent financial vulnerabilities. Operating cash flows have remained negative—worsening from ₹–158 crore in FY24 to about ₹–273 crore in FY25—largely due to high inventory levels requiring short-term borrowings that now account for nearly all debt (tradebrains.in).
On the positive side, the company is moving decisively to address this. It has secured gold metal loan limits from several banks, adopted customer-supplied gold contracts, and achieved working capital improvements. Interest coverage rose to 4.9x, and debt-to-equity has improved to about 0.9x. The firm aims to be operating cash flow positive by FY27, though a modest shortfall of ₹70–100 crore may remain (tradebrains.in).
Valuation & Analyst Outlook
Valuation metrics present a cautiously optimistic narrative. Sky Gold currently trades at a P/E of around 25x, below its fair P/E of roughly 37x and also lower than peers averaging 31–32x, suggesting it may be undervalued relative to growth prospects (simplywall.st). Forward-looking PEG ratios continue to remain modest—under 0.5—reflecting attractive potential for growth compared to price (tradebrains.in).
Analyst sentiment is largely bullish: consensus projects a 12-month target of ₹480–₹523, implying over 50% upside (simplywall.st). Yet coverage remains sparse, so confidence levels depend on execution.
"Strong revenue momentum paired with strategic acquisitions and working capital discipline positions Sky Gold for sustainable expansion," a market analyst noted recently, capturing the balanced optimism among investors.
Outlook & Strategic Takeaways
Looking ahead, Sky Gold appears well-placed for continued revenue and profit acceleration. The company’s aggressive expansion, both organically and through acquisitions, is paying dividends. However, attention remains squarely on its ability to turn cash flow positive and manage debt sustainably.
Investors and stakeholders should monitor:
- Working capital improvements and the pace toward cash flow positivity
- Execution of acquired entities and new client integrations
- Market fluctuations in gold prices and broader B2B jewellery demand trends.
Conclusion
Sky Gold & Diamonds stands at an inflection point. The stock, currently trading near ₹302, reflects strong growth but also underlying financial strain. With robust Q1 and Q2 earnings, strategic acquisitions, and analyst projections suggesting substantial upside, the company looks poised for further gains. Still, its journey hinges on strengthening cash flows and managing debt—crucial steps toward transforming momentum into lasting financial health.
Strategic recommendation: Watch for quarterly cash flow updates and inventory trends. If Sky Gold secures true operational leverage and capital efficiency, the stock may well validate the bullish targets set by analysts.
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