Sky Gold Board has approved the issuance of bonus shares in the ratio of 9:1

Gold jewellery design, production, and marketing are the activities of Sky Gold Limited. The company uses a business-to-business (B2B) model, selling its products primarily to boutiques and mid-range jewellers who resell them online and in physical stores.

Sky Gold is offering nine shares for free for every share

Sky Gold on Saturday, October 26, said its board has approved the issue of bonus shares in the 9:1 ratio. This means that it will issue nine new bonus equity shares of Rs. 10 each for every existing equity share of Rs. 10 each to the eligible shareholders as of the record date. The company said it would inform the eligible shareholders of the record date in due course.

Sky Gold’s market capitalization is Rs. 5000 Crores

Sky Gold, which currently has a market capitalisation of over Rs. 5,000 crores, had previously issued bonus shares in the ratio of 1:1, meaning one free share for everyone held, in 2022.

Q1 of FY24 and FY25 result of Sky Gold

The company is in Stage 4 of the Additional Surveillance Measures (ASM) framework, despite the fact that its shares have risen by more than 256% this year. Net profit rose 91% from Rs. 11 crore to Rs. 21 crore, and revenue climbed 92% from Rs. 376 crore in Q1 FY24 to Rs. 723 crore in Q1 FY25, demonstrating robust growth in both areas.

The company’s gross margin for the quarter was 6.4%; with an improved product mix and more exports, it should reach 7-8%. Strong margin growth was demonstrated by the EBITDA’s double from Rs 18.6 crores to Rs 37.3 crores, with an EBITDA margin of 5.2%.

The jewellery industry is expanding

The jewellery market is expected to reach INR 145 billion by 2028 and is growing at a rate of 15% to 16% per year. The organized segment, which is expanding at a rate of 18% to 19%, benefits from improved consumer experiences and growing disposable incomes, which further enhances industry prospects.

The jewellery industry is benefiting from government announcements of reduced import duties because they are bringing down the cost of raw materials. This shift increases the accessibility and affordability of gold jewellery, which increases demand and allows businesses to offer competitive pricing, thereby promoting market expansion.

Today’s 4% decline in Sky Gold Ltd.’s stock

Following a huge morning rally, Sky Gold Ltd.’s stock is currently down 4% and trading at Rs. 3,345.05. The stock has increased by over 5% during the day today, peaking at Rs. 3,655.00 per share following the announcement of the bonus on Saturday.

Disclaimer: This blog has been written exclusively for educational purposes. The securities mentioned are only examples and not recommendations. It is based on several secondary sources on the internet and is subject to changes. Please consult an expert before making related decisions.