- Kalyan Jewellers invested Rs 350 crore in subsidiary Candere Lifestyle Jewellery
- Investment was through subscription to 17,50,000 equity shares on right issue basis
- Funds will be used by Candere to repay or pre-pay outstanding borrowings
Shares of Kalyan Jewellers will be in focus on Monday, September 21 as the company invests Rs 350 crore in its subisidiary Candere Lifestyle Jewellery.
In an exchange filing on Saturday, September 19, jewellery maker said it has invested in Candere by way of subscription to 17,50,000 equity shares of Rs 10 each on a right issue basis.
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The objective of investment in Candere is repayment of loan extended by Kalyan Jewellers. This is expected to help Candere, in repayment or pre-payment of certain outstanding borrowings, the company said.
Since Candere is a wholly owned subsidiary of Kalyan Jewellers, the latest transaction falls under related party transactions.
Notably, the capital infusion will not cause any change in the percentage of the shareholding of the jewellery retailer in in its subsidiary, which will continue to remain a 100% wholly owned subsidiary.
Kalyan Jewellers have recenlty remained in focus as it received 'buy' coverage by UBS. According to the brokerage, Kalyan has emerged as a pan-India jeweller, broadly emulating Titan's footprint in its network rollout, while standing out with its hyper-local value framwork.
UBS highlighted that Kalyan Jewellers' shares have grown six-fold between fiscal 2022 and fiscal 2026, but still trade at a 45% discount to rivals such as Titan while revenue has grown at one of the highest compound annual growth rate among organised jewellers.
The brokerage estimates 23% revenue CAGR over the next five years, with upside risk if the new value format brand in southern India also scales up significantly. It also believes that Kalyan Jewellers' shares current valuation is very appealing, and leaves more room for further re-rating in the future.
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