D. P. Abhushan Limited (NSE: DPABHUSHAN) Q3 2025 Earnings Call dated Feb. 11, 2025
Corporate Participants:
Anil Kataria — Whole-time Director
Vikas Kataria
Analysts:
Ajit Mishra — Analyst
Unidentified Participant
Kushal — Analyst
Shreya Tiwari — individual investor
Rohan Singh — Individual Investor
Presentation:
Operator
Ladies and gentlemen, good day and welcome to DP Edition Limited Q3FY25 earnings conference call. As a reminder, all participant 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 on a touchdown phone. Please note that this conference is being recorded.I now hand the conference over to Mr. Ajit Mishra from ENY. Thank you. And over to you sir.
Ajit Mishra — Analyst
Thank you Muska. Good evening to all the participants on this call. I am Ajit Mishra, Constant Young Investor Relations. Before we proceed to the call, let me remind you that the discussion may contain forward looking statements that may involve known or unknown risk, uncertainties and other factors. It must be viewed in conjunction with our business risk that could cause future result, performance or achievements to differ significantly from what it expressed or implied statements. Please note that we have mailed the press release results the same. In case if you have not received the same you can write to us and we’ll be happy to send that same over to you to take us through the results and answer your questions. Today we have the Top Management of DT Abhushan Limited represented by Mr. Santosh Kataria, Chairman and Managing Director. Mr. Anil Kataria, Whole Time Director and Mr. Vikas Kataria, Promoter. We will start the call with a brief overview of the industry company performance for the quarter gone past and then conduct Q and a session. With that said, I will now hand over the call to Mr. Anil Kataria. Over to you sir.
Anil Kataria — Whole-time Director
Hello. Namaste. Hello. Yes sir. You’re audible? I’m audible?
Operator
Yes sir.
Anil Kataria — Whole-time Director
Ajit Mishra — Analyst
Thank you. Now I will take this moment to highlight our business development initiative initiatives during the quarter three of this financial year. As per the guidance for financial year 25 strategic expansions, we launched a new showroom in Neemach, Madhya Pradesh during quarter three of this financial year.
Anil Kataria — Whole-time Director
This showroom spawned a super built up area of 7700 sq ft with the modern ground 3 layout located just 150km from our registered and administrative office in Ratlam. Following the successful launch of our Ajmeshwaram in the previous quarter we we are pleased to share that both locations are receiving a positive response from our customers. Additionally, the construction of our second showroom in Ratlam is progressing well. This showroom will have a carpet area of 12,000 square feet with 8,000 square feet dedicated to retail and remaining for back office operation. We accept to launch this showroom by the end of this financial year to support our strategic expansion plans we are planning to raise up to 600 crores throughout the through the QIP route. This will enable to our strengthen our market presence and drive a long term value creation over the five year of dp, Abhor Limited is set to expand its mutual room network on pan India basis targeting key regions such as Gujarat, Chhattisgarh and various part of Bangladesh and Rajasthan.
This expansion aims to enhance our market which provide customers with greater access to our product and solidify our brand’s position in the market. I would like to share our market and promotional activities during the quarters. We organized two significant jewellery exhibitions Parinai and Films of Mevar which took place in Ajmer, Basmala, Binwara and Udaipur from November 25 to December 8. These events were a fantastic opportunity for us to showcase a diverse range of our bespoke jewellery collection. The exhibitions attract a substantial number of customers and we were thrilled to such a positive response. The variety and quality of our collection resonated well with the attendees leading to impressive sales figure. This success of these exhibitions not only boosted our sale but also built up our brand presence. In this region. With that I would like to pass call over to Minister Vikas Kataya who will provide a Detailed overview of Quarter 3 financial performance of the company. Thank you everyone. Thank you Team Evai.
Vikas Kataria
Thank you Anand. Thank you Santos Ji and and the warm welcome to everyone on the call. I’m excited to talk you through our financial highlights for quarter Q3 and FY25. This quarter has been exceptionally with total revenue reaching 1085 crore a 42% increase compared to 766 crore in quarter 3. FY25 this growth was driven by sustained demand during the festival and maintenance. Our EBITDA stood at 56 crore up 92% from 29 crore in the same period last year. Additionally our PET reached 37 crore marking our highest ever growth of 123% year on year compared to 17 crore in Q1 Q3 FY24. In terms of store performance I would like to highlight some of our top performing store. Our flagship store in Zatlam contribute the highest revenue of 750 crore in nine months. FY25 store in Bhopal, Baswara, Ujjain also recorded significant growth with year on year increase of 76%, 54% and 51% respectively.
Moving to our revenue miss 93% of sales contribution by gold, 5% from diamond, 2% from silver and 0.3% from other which include Platinum and all. Looking ahead, we are optimistic about the continued growth potential in the jewelry industry. Our expansion strategy focus on emerging market and product diversification Position us well to capitalize on upcoming opportunities and delivery sustained growth. With that I do now like to open the floor for question and answer. Thank you everyone.
Operator
Thank you very much. We will now begin the question and answer session. Anyone who wishes to ask question with the star N1 on the touchdown telephone. If you wish to remove yourself from questions, you may press star and two participants are requested to use answers while asking a question. Ladies and gentlemen, wait for a moment while the question queue assembles. The first question is from the line of Mayung Kapoor, an individual investor. Please go ahead.
Unidentified Participant
Hello. Am I audible?
Operator
Yes sir.
Unidentified Participant
Thank you. Congratulations sir on a fantastic set of numbers and thank you for giving me this opportunity. I have a few questions. Question number one being that I see the total revenue has increased about 42% for this quarter on a year on year basis. Whereas our gross profit has increased 72%. So wanted to understand what is the reason behind the gross margins being improved?
Anil Kataria — Whole-time Director
Hello. Yes, thank you Mike for the asking the question. So yeah, this quarter we give the extraordinary result and our profit margin increased because we are majorly focused on the wedding jewelry and like diamond jewelry. Both the things we are like focusing. So that’s why the marginal increase.
Unidentified Participant
Got it. Got it. Sir. Enter on the QIP announcement. We’re planning to raise a large sum and earlier we were thinking about going for the franchisee route to increase our number of stores. So just wanted to understand how can we think about the next year it would be a company owned. I’m sorry, your voice is not clear. No sir. Hello. Just give me a second, let me change. Yeah. Is it. Is it better?
Anil Kataria — Whole-time Director
Yeah, yeah. Sorry. So sir, I was talking about the QIP that we are planning on doing and just wanted to understand how do we think about the number of stores going forward both in terms of the company owned stores. I think we had a target of doubling our stores in the next two, three years and then also the franchisee stores. So just wanted to ask that. Right. Yeah. So we are. We are doing 20 to like definitely we are doubling the number. So maybe another two, two, three years. We are doubling the number and as well as we are also planning to open a few franchisee. So yeah, maybe the. The both the route we are taking to in our growth plan. Got it sir. Just wanted to understand more on the QIP side. Why is that we are raising the money. Is it not for the French ID stores or some other reason? No. So the. For the QIB we are.
Unidentified Participant
We are doing to. For the. Our on store. The company on stores. Yeah, got it sir. And sir, for the 19th I see that we rolled at 45% already whereas we had I think the guidance of 15, 20%. So are we, you know I think it’s good to revise it. Are we doing that and how do we. How should we see that for the next year? Sorry, I can’t tell you properly. Can you repeat again?
Anil Kataria — Whole-time Director
Yeah. So I’m seeing we have given a growth guidance of 15, 20%. However this has already grown by 45%. So are we going to revise our guidance and how should we take that number for the next year? Yeah, so. So definitely we are trying to achieve the same growth. But yeah conservative we say at least 20, 25%. We are trying to achieve the growth. Got it. Got it. That’s all from my side. Thank you. Yeah, thank you.
Kushal — Analyst
A reminder to all participants. CMF Star and one to ask question. The next question is from the line of Kushal from Invert research. Please go ahead. What will be the end use of this 600 crore. You know that is my first question. Second is apnea margins. Clearly margins have inflected for the last I think two, three years now. I think the management is working on you know improving margins. So. Wanted your commentary. Margins improve. Right. So majorly store expansion in inventory. Inventory plus the CapEx. So we are trying to doubling the number almost 10 stores. Okay. So accordingly. Okay. Okay. Store expansion existing Joe stronghold areas.
Anil Kataria — Whole-time Director
Yes. So majorly. Majorly we are majorly we are focusing in MP Rajasthan and now we are moving towards Gujarat and we are also.
Kushal — Analyst
Considering UP and Bihar.
Anil Kataria — Whole-time Director
Okay. Okay. And get tier two towns. Tier two, tier three towns. Yeah. Main metros, maximum tier two and tier three. Our focus is major tier two, tier three and maybe one or two stores in tier one. So we are still considering.
Kushal — Analyst
Got it, sir. Got it. My next question was around margins. How will you try to improve this? What are the levers to improve margins? So we. We are trying to improve definitely margin. 20, 25% margin increase. And the margin drive again. Wedding jewelry collection. Jewelry and diamond jewelry. Student jewelry. Jewelry. So then the margin will slowly visually increase. Got it, sir. Thank you.
Ajit Mishra — Analyst
Thank you.
Operator
The next question is from the line of Shreya Tiwari, an individual investor. Please go ahead.
Shreya Tiwari — individual investor
Hello. Yes, ma’am. Yeah. Thank you. Sir. Congratulations for the good set of numbers. I have just one question. As you have mentioned about the franchisee model stores that you are going to open. So are there any plan? How many stores are we planning to open in the next two, three years?
Anil Kataria — Whole-time Director
So franchisee we are trying to open like the two, three franchisees in the next two years and then we’ll expand more on franchises. So initially we just want to open like the 3, 2, 3, 4 franchise first. Not very franchise. Yeah. Okay. And then we are going ahead with the franchisee model. Okay, sir. And have we finalized the locations for franchisee stores? Yeah. So. So the location which we have in the mind like in. In np Rajasthan and Gujarat. So the same location is a fantastic other company on store.
Shreya Tiwari — individual investor
Okay. Okay. Got it, sir. Thank you. And all the best. Thank you, sir.
Operator
Thank you. A reminder to all participants. You may press star and one to ask questions. Next question is from the line of Heath Pare from Ashika Institutional Equities. Please go ahead.
Unidentified Participant
Good evening, sir. And thanks for the opportunity. Sir, I have just one question. Flagship store at Rattailam saw a 23% quarter on quarter degree growth in the top line. So what was the reason for it?
Shreya Tiwari — individual investor
Yeah. Three Q numbers.
Anil Kataria — Whole-time Director
Yeah. Coming at 264 crores versus two clue numbers coming at 343 crores. The plan is doing is in this quarter like in this financial year like we we just crossed 750 crore this year.
Shreya Tiwari — individual investor
Yeah. Nine month numbers. I agree that it’s costing 750 crores. I was just asking if was there any one off in the 2Q quarter for Ratnam School to do 343 crores. And in the third quarter the numbers have been almost 90 crores.
Anil Kataria — Whole-time Director
Yes sir, 80 crores. Not exactly. But because. Because of the prices is the little high. The gold price is little high. That’s why the we are doing the extraordinary in quarter two. Because of the gold prices.
Shreya Tiwari — individual investor
Okay. Because because of the gold support better than the last. I was just asking on the quarter. On quarter basis. Okay. And sir, one more question sir. Out of our total what you can say revenue how much is coming from wedding January and how much is coming from due to Jesus.
Anil Kataria — Whole-time Director
So Almost like the 50 55% is coming from the wedding. 50 to 55%. And then what is directionally are we seeing just as you mentioned in their opening comments that the strategic shift happening towards 18 carats and rose gold white gold kind of jewelry. So how are you seeing the demand shaping up in this segment at BP level? Yeah, so. So the people now the people is trying to get some fancy jewelry like the rose gold white gold jewelry. Mean in 22 carat there are the rose gold jewelry also available and in diamond rose gold jewelry. Is very very popular nowadays. So people are like buying rose gold jewelry and white gold jewelry. So definitely the demand is very high in particular segment.
Unidentified Participant
So how much DP does? Are you doing any What. What is the percentage contribution from rose gold white gold General?
Anil Kataria — Whole-time Director
Yeah, so the white gold and rose gold jewelry contribution is nothing very much. But yeah, 10 to 15% is the total contribution.
Unidentified Participant
Okay. Thank you.
Operator
Thank you. A reminder to all participants. You may press star and one to ask question. The next question is from the line of Rohan Singh and individual investor. Please go ahead.
Rohan Singh — Individual Investor
Hello. Can you hear me?
Anil Kataria — Whole-time Director
Yes. Yes sir.
Rohan Singh — Individual Investor
Hi. Thank you for this opportunity. Sir. I wanted to understand store metrics in the investor presentation. So when comparing the year on year performance for the first nine months Ratlam our oldest store grew by 42%. On the other hand our stores in Bhopal, Banswara and Ujjain showed even higher growth than Ratlam. So what are your observations regarding the performance and growth of these locations?
Anil Kataria — Whole-time Director
So definitely our all store being there very good growth in this like the nine month growth. So and the other store is the very new store or growth is very higher. So we are trying to achieve the more more growth in the other store like Baswala, Ujjain, Bhopal and Udaipur and Kota. Everywhere we are trying hard to get more growth.
Rohan Singh — Individual Investor
Okay. Okay. And my second question is could you please provide the capital expenditure incurred for the newly opened stores in Azure and Limaj. Additionally what is the current inventory value held by these stores?
Anil Kataria — Whole-time Director
Yeah.
Rohan Singh — Individual Investor
Hello. Hello. My second question is could you please provide the capex incurred for these newly opened schools in Ajuman and me much.
Vikas Kataria
Yeah. This is approach inventory which is held at the store is 1 minute 55 to 60 cr. Okay.
Rohan Singh — Individual Investor
And my last question is till when can we expect the stores to reach break level with the reference to the current performance
Anil Kataria — Whole-time Director
Around the six to nine months.
Rohan Singh — Individual Investor
Okay. Okay. Yeah, thank you. That’s that. That is from my. Thank you so much.
Operator
Thank you. The next question is from the line of PR from Singular Capital. Please go ahead.
Unidentified Participant
Hi sir. Thank you for the opportunity. My first question was the other expenses have jumped up significantly quarter on quarter. Any points, any details you’d like to give on that? Yeah, so we are launching the new store. So the marketing budget is little bit increased in in particular the quarter. So that’s why we are launching the new store. That’s why the other expensive business they can have particularly this year.
Anil Kataria — Whole-time Director
Yeah. Okay. The second question is on the. On our inventory accounting model. So as I understand, our inventory accounting model is slightly different from most of our other peers in that we use the historical average cost method. So I just wanted to understand if we were to use inventory model comparable to our peers, our gross margins would be lower. So any sense you could give us on how much lower our gross margins would be in that case. So gross margin is lower like the 2, 3% lower than the. Like the other pair and industry.
Unidentified Participant
Sorry, sir, Go ahead.
Anil Kataria — Whole-time Director
Yeah, so gross margin is the lower like the 2, 3% gold in the other pair in the market. Right. We use a historical average cost of acquisition. We using the weighted average weighted average method for the big method. Yeah, yeah, yeah. So like, like if the market is like the 88,000, but I was like our inventory price is somewhere around like 73, 74,000. Mental price. So understood that is what I was thinking. We have inventory cost is 73, 74,000. Whereas if we were using the 4, 4 model or some other inventory accounting model, our cost of inventory would be higher than what we have currently. Is that the right way to understand it? Yes. So in that case, our gross margins. Can you give us an example on a basis of what the gross margin.
Rohan Singh — Individual Investor
Would look like in that case Because
Anil Kataria — Whole-time Director
I’m just trying to understand like you said, our gross margins are different spheres but using different accounting methods for inventory, it doesn’t make to compare. So on a like to like basis what they would look like is what I’m trying to understand. Right. So maybe we could just take this question offline. I’ll get in touch with D by yeah.
Rohan Singh — Individual Investor
Okay. Thank you. Thank you.
Operator
A reminder to all participants, CMS are in one to ask questions. The next question is from the line of Kushal from Invert Research. Please go ahead.
Kushal — Analyst
Yeah. Hello sir. Thanks. Thanks for the opportunity again. Since I’m new to the company, how do we hedge our inventory? Do we. Are we doing GML loans? Or suppose if tomorrow gold prices go down, what will happen to our inventory value?
Anil Kataria — Whole-time Director
Yeah, so we are. Thank you for asking the question. So we are doing the weighted average method. So our inventory price and market price is a different. So our always our as of now our inventory price is lower than the market around like the. Maybe like the 7, 8%, 10% lower than the market if market goes down. So we are already hedged. We are already hedge and yeah we have the plan to hedge the inventory. So then definitely market values are similar. Then the market value is high. We are already literally hedge.
Kushal — Analyst
Okay, but going forward, sir, just say, let’s say one or two years out, market goes down, market price and our book price is the same then definitely we are.
Anil Kataria — Whole-time Director
We’re doing the hedging method, local thing, gold metal loan plus future hedging and future options. So as of now there is no hedging but we are using accounting policy which is we are marking our inventory lower versus the market value of the inventory. Yeah. Our price is like the. Almost like the 7 to 8%. We are 10% less than the current market price.
Kushal — Analyst
Got it, sir. Fair enough. Thank you.
Operator
Thank you. A reminder to all participants. You may press star and one to ask question. Yes. There are no further questions from the participants. I now hand the conference over to the management for closing comments. Over to you, sir.
Anil Kataria — Whole-time Director
Thank you. Thank you so much. Say Hamas. Thank you so much.
Operator
Thank you. On behalf of CP Abhishan Limited that concludes this conference. Thank you for joining us. And you may now disconnect your lines. Thank you.