BlueStone Jewellery Shares Surge 7% on Massive Q1 Profitability; Can the Momentum Outlast Custom Duty Rise?

BlueStone Jewellery Shares Surge 7% on Massive Q1 Profitability; Can the Momentum Outlast Custom Duty Rise?​

Shares of BlueStone Jewellery continued their strong rally, closing at ₹832 on the BSE after climbing another 7%. This movement extended the stock's winning streak to a third consecutive session and has driven gains totaling 36% over the past three days. The sharp buying momentum is directly linked to the company’s robust Q1 performance, marking a significant turnaround in its financial trajectory.

Stellar Q1 Results Drive Profitability Surge for BlueStone Jewellery​

The jewellery retailer reported a net profit of ₹14 crore in the first quarter of FY27. This represents a drastic improvement compared to the corresponding period last year, when the company had registered a net loss of ₹21 crore. Furthermore, standalone revenue saw a substantial rise of 48.8% year-on-year, reaching ₹733 crore.

The profitability story continued strongly as standalone EBITDA increased by 134.6% year-on-year to reach ₹55 crore. This success was underpinned by strong operational health indicators. Same-store sales growth registered at 39% YoY during the quarter.

Strategic Expansion and Operational Efficiency Reported​

BlueStone expanded its physical presence in Q1FY27, adding 12 new stores. The company’s total store count now stands at 352, spread across 139 cities. Management stated that this performance reflects resilient consumer demand and the portfolio's relevance across various price points. Operating leverage improved significantly, with the EBITDA margin expanding by 273 basis points from the previous year.

The company highlighted that this success occurred despite a rise in the custom duty on gold, which increased from 6% to 15%. This outcome underscores structural drivers like design innovation and portfolio breadth. After reporting its first full year of positive reported PAT in FY26, BlueStone is continuing its profitable trajectory into FY27.

Analysts Maintain 'Buy' Rating as Growth Outlook Remains Constructive​

Systematix maintained a "Buy" rating on the stock, setting the target price at ₹832, which is exactly where the shares concluded trading on Thursday. The brokerage projects aggressive growth, anticipating that BlueStone could add around 75 stores annually. This expansion effort aims to grow their total store network to 571 outlets by FY29E.

Systematix's estimates are built on an age-cohort framework, which assumes improved store productivity as outlets mature. They expect the proportion of stores more than three years old to rise from 46% in FY26 to 60% by FY29E. The average store age is projected to increase from 2.7 years (FY26) to 4 years (FY29E).

Market Confidence Sustained by Industry Momentum and Festive Demand​

The outlook remains highly constructive, with market leaders reinforcing confidence in the sector's long-term demand. Pankaj Kumar, VP Fundamental Research at Kotak Securities, alongside Anil shares a positive view on BlueStone Jewellery compared to its peers. He suggests that growth momentum appears sustainable beyond Q2 of FY27.

Anil further noted that while gold prices influence purchases, stable gold rates should support demand effectively. Initiatives such as recycling and gold exchange programmes are expected to boost both affordability and customer engagement. Importantly, the festive season and peak wedding period in the second half of the year typically provide a strong tailwind for the industry.

Key Factors to Monitor Moving Forward​

Investors are advised to closely track management commentary and the pace of store expansion in the coming quarters. The sector’s performance will also be shaped by consumer sentiment, with gold price movements being a critical element. Leading organised jewellery retailers are expected to deliver healthy growth if gold prices remain relatively stable moving forward.