Kalyan Jewellers India Limited (NSE: KALYANKJIL) Q1 2026 Earnings Call dated Aug. 07, 2025
Corporate Participants:
Unidentified Speaker
Rahul Agarwal
Amish Salyani Raman — Executive Director
Sanjay Raghuraman — Chief Executive Officer
Ramesh Kalayanaraman — Executive Director
Analysts:
Unidentified Participant
Gaurav Jogani — Analyst
Nihal Mahesh Jam — Analyst
Har Shah — Analyst
Ashish Kanodia — Analyst
Subhanu — Analyst
Dheeraj Mistri — Analyst
Pallavi Deshpande — Analyst
Ali Sagar Shakil — Analyst
Darusheel Zaveri — Analyst
Naveen trivedi — Analyst
Aditya Sharma — Analyst
Bhavya Gandhi — Analyst
Presentation:
operator
Sam, it’s. Ladies and gentlemen, you are connected to Kalyan Jewellers India Limited Q1FY26 earnings conference call. Please stay connected. The call will begin shortly. I repeat, ladies and gentlemen, you are connected to Q1FY26 earnings conference call of Kalyan JWellows India Limited. The call will begin shortly. Please stay connected.
operator
Thank you. Ladies and gentlemen. Good day and welcome to the Q1FY26 earnings conference call of Kalyanj Wellers India Limited. 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 then zero on your touchtone phone.
Please note that this conference has been recorded. I now hand the conference over to Mr. Rahul Nagarwal. Thank you. And over to you sir.
Rahul Agarwal
Thank you. Good evening everyone and thank you for joining us on Kalyan JLS India Limited Q1FY26 earnings conference call. Today on the call we have with us Mr. Ramesh Salyan Raman, Executive Director, Mr. Sanjay Raghunar Raman, CEO, Mr. V. Viswana Swaminathan, CFO, Mr. Sanjay Mehrotra, Head of Strategy and Corporate affairs and Mr. Ibrahim George, Head of Investor Relations and Treasury. I hope everyone had a chance to view our financial results and investor presentation which were recently posted on company’s website and stock exchanges. We will begin the call with opening remarks from management followed by an open forum for question and answer session.
Before we begin, I’d like to point out that some of the statements made during today’s call may be forward looking. As a disclaimer to that effect was included in the earnings presentation. I would now like to invite Mr. Amish Salyani Raman, Executive Director of Young Jailers India Limited to give please open remarks. Thank you. And over to you, sir.
Amish Salyani Raman — Executive Director
Thank you. Good evening and let me welcome everyone to the call. I’m extremely satisfied with our performance in the recently concluded quarter. While the consolidated revenue and path growth for the quarter have been approximately 31 and 49 respectively. Standalone business recorded revenue growth of 31% and PAT growth of 55%. Let me take some time to reflect on the targets that we had set around the key objectives of revenue growth, improvement in cash flow, return on capital and rewarding shareholders. Over the last three years we have opened more than 160 Kalyan showrooms in India, predominantly through the Capital Light FOCO model.
Share of Foco revenue has grown to 43%. As on June 30th, 2025, our revenue CAGR for the last three years have been approximately 37% for India and 35% consol. We have also been able to substantially reduce our non GML working capital loans over the last two years and as you are aware we also have realized cash via sale of mobile non core assets. All of these have helped improving the return profile meaningfully. Now the key focus areas going forward will be realise and monetization of real estate collaterals presently with the banks. Secondly, creation of retail formats beyond Kalyan Jewelers and Cantier and supply side restructuring to drive meaningful improvement in the margin profile of Kalan Jewelers.
We have already done considerable work on some of the areas that I just mentioned. We have started documentation with the banks for the release of collaterals worth 200 crores. Given this development, we have decided to put a pause on further debt reduction till we get the lease of the first tranche collapse over the last 12 to 18 months. We have also been giving shape to our plans to expand distribution network beyond the mainstream Kalyan dealers. Candir was identified as a second format with predominant focus on lightweight lifestyle jewelry and as you are aware we added more than 70 Candir showrooms in the last 18 months.
We launched the brand campaign for Cantier during the current financial year and plan to add 80 Candir showrooms in India this year. Footfalls at the showrooms and conversions have shown more than 75% increase since launch of the brand campaign. Candir should end pat positive neutral by the end of the current financial year. With Candere stabilizing, we have decided to launch the third format which will essentially be an entity that will house regional brands offering exclusively localized jewelry competing with strong regional brands. We have drawn up plans to launch the first regional brand under this entity during this calendar year.
Apart from changes in the merchandising go to market strategy, we have also adopted a key change in the procurement plan for the new format by focusing on a lean credit period ensuring better cost efficiencies. Even though this strategy will be fully. Implemented in the new format from day one, we have already successfully completed a pilot project with this strategy in Kalyan Jewelers. We are exploring ways to implement it fully as a lever for significant margin improvement in the main format Kalyan Jewelers in this financial year itself and now talking about the ongoing quarter, we have started off well despite continuing volatility in gold prices and we are at higher base. We are upbeat about the upcoming festive season across the country and gearing up for the launch of fresh collections and campaigns. Thank you. And I will hand over to Sanjay.
He will take you through the number.
Sanjay Raghuraman — Chief Executive Officer
Thank you, Ramesh. Good afternoon everybody. I’m really happy to be talking to you after this great quarter that we had. Our company reported A consolidated revenue of 7,268 crores in the just concluded quarter. A 31% growth over the corresponding quarter of the previous year. Consolidated EBITDA came in at 508 crores versus 368 crores in the corresponding quarter of the previous year. And consolidated profit after tax came in at 264 crores versus 178 crores in the corresponding quarter of the previous year. Moving now to talk about the breakup of the numbers between India and the Middle East.
Starting with India, India revenue came in at 6142 crores for the quarter versus 4681 crores in the corresponding quarter of the previous year. And India EBITDA for the quarter came in at 434 crores versus 309 crores when compared with the corresponding quarter of the previous year. India profit after tax was 256 crores compared to 165 crores in the corresponding quarter of the previous year. Talking now about the Middle east business, revenues in the Middle east for the quarter came in at 1026 crores versus 809 crores compared to the corresponding quarter in the previous year. And EBITDA in the Middle east came in at 73 crores versus 62 crores for the same quarter the previous year.
The Middle east business posted a profit of 22 crores in the quarter compared to 19 crores in the corresponding quarter of the previous year. Lastly, talking about Candia, our e commerce business, we posted a revenue of 66 crores in the quarter versus 39 crores in the corresponding quarter of the previous year. Candia recorded a 10 crore loss in the quarter versus a loss of 2 crores in the corresponding quarter of the last year. With this we are done with the summary of the financials and the numbers and we now open the floor for questions. Thank you.
operator
Thank you very much. We will now begin the question and answer session. Anyone who wishes to ask a question may press star n1 on their touchstone telephone. If you wish to remove yourself from the question queue, you may press Star and two participants are requested to use handsets while asking a question. Ladies and gentlemen, we will wait for a moment while the question queue assembles. We Take the first question from the line of Gaurav Jogani from GM Financial. Please proceed.
Gaurav Jogani — Analyst
Hi, thank you for taking my question and congratulations on a strong set of numbers. So my first question is with regards. To this new pilot that you have mentioned regarding this procurement plan with a linear credit from the vendors. If you can, sir, elaborate more on. This and how much of this benefit. During this quarter in the gross margin because of this pilot project that you did?
Amish Salyani Raman — Executive Director
Yeah, so there has been a margin improvement and predominantly major reason like what you said is because of the silhouette project, just to quantify. But yes, there has been some improvement because of that and the margin improvement, which is not. We should not give full credit only for that pilot project which was implemented. There has been revenue from platinum, silver, etc. Where the margins were on a higher side predominantly because of the metal price. Platinum revenue comes Approximately what to 2 1/2% of our revenue, wherein the margins were higher. So that plus the pilot which we did both together actually helped to increase our margins.
And of course EBITDA margins, if you are mentioning some operating leverage also was there at the level.
Gaurav Jogani — Analyst
Wanted to know that because you have done this pilot, how are you planning to take this ahead and how is the impact of this would be on the overall working capital cycle? Because if we are planning to pay the vendors a bit earlier in lieu of some discounts, so how this can have an impact on the overall capital cycle for us.
Amish Salyani Raman — Executive Director
So this pilot was actually done because we wanted to implement this from day one in the regional brand, which we are going to launch so shortly, maybe before this calendar year because we want to go in that direction in terms of procurement for the region brand. It was also done to exactly know the savings cost efficiencies which can happen if we do a linear credit arrangement with the vendors, which was successfully done now to now to make it implemented in Kalyan Jewelers fully. It is again a big project and we are just trying to plan how to implement it at Helium.
Join us. And if that is implemented, yes, there is going to be meaningful increase in the gross margin. And that is what we are trying to target for the pilot project that we ran. The ROCE for the capital that we allocated for the project was actually higher than the corporate ROC as of now.
Gaurav Jogani — Analyst
Okay, okay, okay. And any timeline you would like to share that by what time this project can be implemented on that at the Kalyan Jewelers level.
Amish Salyani Raman — Executive Director
First we will do it from day one in the regional brand. The regional brand launches where we are going to do it from day one fully. And that should come before the calendar year. And during that time we will give you a overview about how we are going to do with er, Kalyan and the timelines, etc.
Gaurav Jogani — Analyst
Sure. And. The pilot, which we did, will continue so that you can have some margin improvement because of that for the full year. But to expand that pilot project, we will need to give you. You will need to give me some more time because we will have to implement that in the regional brand which we are going to launch and then start implementing at Kalyan. It’s a big project, so you’ll have to give me some more time for us to come back on the timelines. On second, on this regional brand strategy, if you can elaborate more, will this be under the Kalyan dealer brand or. The brands in each of the region would be different. How the strategy would be here.
Amish Salyani Raman — Executive Director
The. The target is to be completely regional. So there will be a new company which will be formed which will be having multiple brands and each brand will be in a particular state and it will be very regionalized by its name, by its inventory, by its campaigning, positioning, etc. And that is how we are going to do it in this new subsidiary where we will have multiple regional brands. The first regional brand we will be launching before the calendar year. And we. Will launch the other regional brands only once this gets stabilized. So for this year we have plans only to launch one regional brand in a particular state. Post that getting stabilized, then only we will go to the next video. Just one thing here. Would this brand will be purchased or. I mean you’ll be creating this in house. We will not. It’s not inorganic. We will create the brand.
Gaurav Jogani — Analyst
Okay. Okay. And just lastly, you also mentioned in your opening remarks about the pause for debt reduction. So. So the. The debt reduction pause would be largely because of the funds that will be utilized in this pilot project or the project towards the the new brand, as well as on the improvement process. Improvement initiative. That is the reason.
Amish Salyani Raman — Executive Director
The reasons are mainly because we were looking at a situation where we want to start the documentation with the banks to bring out the collaterals for the reduced loan, which we have already done, which is now on track. So now we want to take a pause so that we can wait for that collateral to come out in between. We will use the cash generated in this financial year predominantly for the pilot project which we have done. We have implemented already. We have used the all available resources for this pilot project and future also for the new brand.
It will be a Multiple of what. You call it will be equity also. It will be that also we might raise some debt also for that company in the facility.
Gaurav Jogani — Analyst
Okay. I’ll come back in the queue for more questions. Thank you.
Amish Salyani Raman — Executive Director
Yes.
operator
Thank you. The next question is from the line of Nihal Mahesh Jam from HSBC Securities. Please proceed.
Nihal Mahesh Jam — Analyst
Yes, sir. Good evening and congratulations. First question on this adjusted term that you’re speaking. So just to understand why we are implementing those first in Kalyan and if it works right, then we plan to roll it out with the regional brand. But only after it works with the regional brand do we plan to take. Plan to take the entire Kalyan model on this leaner credit period. Is that the right understanding of the timelines?
Amish Salyani Raman — Executive Director
The pilot project, it’s already implemented at Kalyan. So we already started by maybe March last year. Okay. And full quarter this full quarter, April, May, June. We actually did the pilot project at Kalyan. Now we will implement it fully from day one in the new regional brand. Once that is launched, then we will take initiatives to launch it fully at Kalyan business.
Nihal Mahesh Jam — Analyst
So in this quarter, I’m guessing approximately, say a small proportion of our procurement in Kalyan would have been done via the Lena Credit model. Is that the right understanding?
Amish Salyani Raman — Executive Director
Yeah.
Nihal Mahesh Jam — Analyst
Would it be possible to share what was the ballpark proportion of the procurement that was done in this model?
Amish Salyani Raman — Executive Director
Yeah. So the. The capital allocated for this pilot project. Okay. The. The ROCs were actually higher than our corporate RO. As I said, all the resources available with us actually we utilize for this pilot project. And as you said that the implementation of this model will lead to an improvement in the overall ROC profile. Because generally sometimes you’ve seen that while margins improve by extending period paying off here. But eventually it seemed to be a roasted drag with some. Some other companies who’ve implemented this. In our case, we are saying that ROCE will also improve despite the increase in working capital. Yes. So the ROCE actually for the pilot project which we listed was higher than our corporate roce.
Nihal Mahesh Jam — Analyst
Understood. And because the balance sheet for this quarter is not visible that if we had to implement this across the entire Kalyan network, what would be the increase in working capital or fund that would be required?
Amish Salyani Raman — Executive Director
Lean credit means it’s not completely out of credits. Okay. So pay bill days which will then. Yeah, this might need around,500 to 2,000 crore. Thousand five hundred to 2,000 crore. Sure. Yeah. So whether it can be done on. Whether it can be done on faces, whether it can be done together the structure of how to bring in the capital etc that’s why I wanted to take some time and then we are still working on it from day one but we will adapt this in our new format.
Nihal Mahesh Jam — Analyst
Got that? The second question was on the new subsidiary that we are launching. So there also as you said that the first pilot will be one state this year and depending on how that progresses you will move to the next year. So is there any thought on what could be say the requirement of capital, how many ballpark stores we are thinking of launching in each state? We want to understand that along with this in terms of the capital requirement for the next few years that is where the question is going to.
Amish Salyani Raman — Executive Director
For. That what we are trying to do is that we will be opening only in one state from for the next 12 months and we will open only five showrooms. That is the target for the next 12 months. Initial we might need what 300 crore of working capital. But post that expansion for that format is again 4 crore. So we don’t need additional capital there.
Nihal Mahesh Jam — Analyst
Understood. So it will be the initial model and then you move to the Poco model like in Kairo. So last question I will come back on the queue that we obviously managed to deliver a strong SSG this quarter despite gold prices being elevated at least for the most part of June. Now for the month of July also we’ve seen that gold has not only seen any sort of cool off. So if you could just comment on how the demand trends there have been and is there a case being built that in case there is a reduction in gold prices you feel there’s a lot of pent up demand where you can see a strong comeback in growth in the ensuing quarters in case gold corrects.
Amish Salyani Raman — Executive Director
Yes, again last even when the gold prices were high our SSD were what 18% last in the last quarter. Okay. So there is no pile up demand wherein because we were at 18% SSD in the last quarter. Okay. That’s what we have to understand. So the revenue moved from week to week or month to month depending upon the volatility in gold prices. So when the gold price is too high and when it is very volatile people take a pause and see where it gets settled down and then come back to shop. And marriages cannot be postponed because the price were high.
So there is no pent up demand which can come because the gold price comes down. Okay. And if you talk about July, July started up good. Okay, first two, three weeks are good. And last week, August first week and July last week it is not Actually comparable to last year because there was a higher base in the last financial year because of the customs duty reduction. So footfalls are still strong like july first week, second week. But the only thing is July last week and august first week when compared to last year. The base is very high in the last year.
But we think that quarter should be okay because this year we should get around what, nine, ten days of festival event Navaratri. Because Navaratri starts in this corporate cell.
Nihal Mahesh Jam — Analyst
This year. On district, sir. This is very clear out of that. Thank you.
operator
Thank you. The next question is from the line of Har Shah from Bandhan amc. Please proceed.
Har Shah — Analyst
Yeah. Hi sir, thanks for taking my question. I’m sorry, I just joined a bit late in the call with this. Wanted to understand this pilot, this new pilot a bit more. Are we essentially saying that we are also going into backward integration? I mean will we also, I mean replace the likes of Emerald also or how does it work basically in terms of this localized wedding from that point. Of view.
Amish Salyani Raman — Executive Director
Backward integration. So you just. Actually if I want to make it very clear, it is a three step, okay. Step number one is to do this linear credit period kind of planning for our vendors. That is the step number one. Step number two, what we will ideally do is actually make a hub for all our contract manufacturers. It’s like a jewelry park which already we have procured land in our hometown Trishur, Kerala from the Kerala government. Kerala government has allocated land for us where we will actually bring in all our south contract manufacturers there. It will not be a margin driver but more of efficiency driver and again younger generation to come in etc.
Because facilities will be there. There will be meaning it will be have more infrastructure facilities where youngsters will also be motivated to come and join their what you call family business etc. Third step is what you are telling is manufacturing. That will be the third step which will meaning it’s not going to be in the near future. So our near future will be lean credit period, cost efficiency margin increase.
Har Shah — Analyst
In the second step, sir, which you mentioned as in the land which you purchased and a jewelry park which you. Are intending to, you know, set up there. There really are saying that whatever contract manufacturer guys you work, they you would want them to kind of have, you. Know, probably we will facilitate them to.
Amish Salyani Raman — Executive Director
Come and work at our infrastructure so that the facilities are good. Okay. They can also grow more along with us. It will be an inspiration for the younger generation also to join them. And it is actually an initiative for them to grow their business. Again along with us. Because they don’t have to invest on infrastructure, they don’t have to invest on it, they don’t have to invest on anything else. Okay, we will identify such vendors who want to grow with us and then we will park them in our hub.
Har Shah — Analyst
Okay. So this Hubson will cater the requirements of one state or the south market initially.
Amish Salyani Raman — Executive Director
So we are now planning for a predominantly Kerala but south market. In 12 months time. I mean indicatively at 24 months time would probably have the entire south market covered by this hub. Not entire, but yeah, yeah, south is. What we target for because south itself comes with different products. Like south. Maybe the persistone vendors might not come to Kerala. So it is not fully south but predominantly south.
Har Shah — Analyst
Okay, okay. When you are facilitating them in the infrastructure, would you not kind of even cut down on the margins which you give to them? Let’s say if you are at 68% margins, let’s see if you give to them, would you not kind of now come down to 4, 5% there?
Amish Salyani Raman — Executive Director
Yeah, there will be nox also there. No, so that will not be a major margin driver. Margin driver will be the number one and three. One being the first step which we will take the linear credit period. Then it will be the step three wherein we go to manufacturing. Step two, more than margin efficiency, it will bring more efficiency on the turnaround of the inventory, etc. That will be the focus.
Har Shah — Analyst
Okay, but when would you go to step three, sir, in terms of manufacturing? Because at one side you are calling your partners and asking them to work with you and then your next step is basically to take their own business, right?
Amish Salyani Raman — Executive Director
No. So step two is for contract manufacturers who are very small today wherein they will have only 5 workers, 10 workers, Etc. Okay. Those products they are making for us in our premise, okay, we already are dealing with them as contract manufacturers only for manufacturing products which we are now procuring from wholesalers or manufacturers.
Har Shah — Analyst
Okay. Like we kind of take it in house.
Amish Salyani Raman — Executive Director
Can you repeat the question?
Har Shah — Analyst
Like emerald etc is what you want to take in house?
Amish Salyani Raman — Executive Director
I don’t want to name anybody, but yeah, step three is where we will, we will actually do something where we procure products from manufacturers, wholesalers.
Har Shah — Analyst
Okay. Our primary, again I repeat, the near future target is not that near future target is linked. Okay. What I mean, sorry, I just joined a bit late. Could you explain this detail again if you can kind of help me with that.
Amish Salyani Raman — Executive Director
Yeah. So here we, you know that Kalyan, we have two formats today. Kalyan jewelers and Candia. So we want to enter into the third format wherein it will house regional brands. The brands will be specifically created for that particular region. That is the third format which you want to create. And in that basket of brands, the first regional brand we want to launch before this calendar year.
Har Shah — Analyst
Okay.
Amish Salyani Raman — Executive Director
So in between that, the procurement pattern also need a leaner credit period in those regional brands for which we wanted to try a pilot in Kalyan Jewelers initially before bringing it to our new regional brand. So we started that pilot project by say March in the last financial year for Kalyan. Of course, this quarter we got fully at Kalyan. And what we. What the takeaway is that the capital allocated for this pilot project, the ROEs were actually higher than our corporate ROI. India. India, sir. I mean corporate.
Har Shah — Analyst
Yeah. Okay, okay, okay. Got it. You’re saying. And the plan is now.
operator
Sorry to interrupt, Mr. Harsh.
Amish Salyani Raman — Executive Director
Yeah. The plan is now to execute it fully. That’s it. For which we will give a detailed. It’s a big plan. Right. So we will come back with a solid plan as to how to implement it.
Amish Salyani Raman — Executive Director
Thank you so much.
operator
Thank you. Thank you. Before we proceed with the next question, a reminder to the participants that you may rest star and one in order to ask a question also. Again, a reminder to the participants that please limit your questions to two per participant as there are several participants waiting for their turn. The next question is from the line of Ashish Kanodia from Citigroup. Please proceed.
Ashish Kanodia — Analyst
Yeah, thank you for the opportunity. The first question is on this lien credit period. Right. How does it changes the sourcing in terms of gold medal loan will you know, once you kind of implement it across Kalyan Jewelers, will the gold metal loan contribution go down meaningfully from here?
Amish Salyani Raman — Executive Director
No, no, no.
Ashish Kanodia — Analyst
So nothing does not what you call relate to gold metal on at all. So you will. You will have noticed that our payables are usually in the range of 30, 35 days.
Amish Salyani Raman — Executive Director
Okay. Payable days, which we will have to bring it down by at least by one third. That’s what we did as a pilot and we saw a very good margin increase. Cost efficiency was very high that we want to adapt at full in Kalyanjiudas. This does not relate to gold metal loan. Gold metal loan. In fact, we have already taken it to the September levels.
Ashish Kanodia — Analyst
Got it. And secondly, on the regional brand strategy, now you know, within Kalyan you already have been doing the hyper local strategy and you know, and we can see that in how you have expanded in the non south region. So you know, when you look at the launch of this regional brand, one, what, what is the rationale? Because you already have something which is doing a hyperlocal strategy. Second thing is, how should we also think about, you know, like the brand pool? Because currently, you know, when you do marketing branding, it’s under one umbrella, one brand. So how do you create the brand pool specific.
Typically when you are competing against a regional brand in most of this micro market, this regional brand have a very strong brand pull. And third question related to the regional brand strategy, how should we think about the margins here? Because a lot of this regional brand basically cater to the staple product which anyways much lower gross margin product. So yeah, this thing on the regional. Brand strategy, three things.
Amish Salyani Raman — Executive Director
One is yes, we are a hyperlocal brand where Kalyan, you know that 30% inventory, we keep hyperlocal products, okay. That is actually a way to drive what you call business to Kalyan. Right? So we actually target customers who. To people who are today with regional brands. But they have a bit aspirational. So it is an enabler. The 30% hyperlocal inventory is an enabler to target aspirational regional brands. Okay? Regional customers. So now coming to Regional, the 100% regional brand, it is only. It will be only having those regional products, okay. It will talk to regional customers who are not aspirational.
They are very happy with the regional player today, okay. They don’t have any immediate aspirations to move up the ladder. And you know that even Today we have 60% revenue from the unorganized segment who are ramping up to organized players. And the first step will be to go to a regional player and then to people like Alia. So, so we wanted to be there, okay. That is about the strategy. And we see a huge vacuum also there. Okay? So that is about the brand strategy. Now if you look at the margin, yes, you are right.
The gross margins are lower. It will be almost what Kalyan was in say 2010, wherein we were. We were actually a regional brand at that point in time. But the stock turns are higher. The RO for that business, I think what will be in the range of what, 18, 20%. That’s how the model created.
Ashish Kanodia — Analyst
Got it. And just last bit is on the EBITDA margin this quarter, right? I mean, you know, given the focal model, normally we should have seen a EBITDA margin contraction. But while gross margin has contracted, there is a decent bit of EBITDA margin expansion which we have seen this quarter. Now, you know, when you talk about the operating Leverage part. If growth continues to remain broadly similar to what we have seen in this quarter, plus minus here and there, is it fair to say that we should continue to see operating leverage given that the base is already becoming strong? And even if I look at the share of franchisee revenue, it’s almost very similar to what it was last quarter.
So from ebitda I understand gross margin may still remain kind of continue to go down. But on a EBITDA margin level, how should we think about on a full year basis?
Amish Salyani Raman — Executive Director
So operating leverage will surely continue and the margins have come down again like you said. Yoy. That is largely because of the higher share of franchise revenue. But yes, the impact has been partially negated this quarter by margin gains from the pilot procurement project that I mentioned. Now then the higher gross margins in Platinum Silver, that’s also there over and above the operating leverage when it comes to EBITDA level. So it should continue. Pilot will continue, operating leverage will continue. But the revenue or the gross margin increase from Platinum Silver we are not sure wherein it depends upon where the price is.
Ashish Kanodia — Analyst
That’s helpful. This last question was on the collateral part.
operator
I would request you to go back to the queue as there are several participants waiting for their turn.
Ashish Kanodia — Analyst
Sure. Thank you.
operator
Thank you so much. Sir, before I proceed with the next question, a reminder to the participants, I would request you to please limit your questions to two per participant. The next question is from the line of Subhanu from 3 at Capital. Please proceed.
Amish Salyani Raman — Executive Director
Yeah. Yes. Yes, I can hear you.
Subhanu — Analyst
My. My first question is what is your demand tax return from upcoming festival? Can. Can we expect a better performance than last year?
Amish Salyani Raman — Executive Director
The demand expectation. I told you that meaning July was good first two, three weeks and now it’s not comparable over the last two weeks because the base was very high. But we also have the festive days of 8, 9. Last year it was. There was no festive days because October 2nd only change shradd got ended. So I think partially the customs duty impact should be negated by that. So we are very upbeat and fully prepared.
Subhanu — Analyst
Understood. My second question is are you seeing. Any type of footfall slowdown in TF3 and 4 cities?
Amish Salyani Raman — Executive Director
Nothing. Nothing at all.
Subhanu — Analyst
Okay. Okay. Understood. Thank you.
operator
Thank you. The next question is from the land of Dheeraj Mistri from ICICI Securities. Please proceed.
Dheeraj Mistri — Analyst
Yeah. Hi. Good evening sir. And some very good. One thing I want to know this is that when I compare the Titan margin versus our margin and when we see the studied ratio, despite having higher studied ratio, our EBITDA margin is quite low compared to the Titans. So what are the reasons for that?
Amish Salyani Raman — Executive Director
So this has to mean. So if you look at Kalyan split it into two own store revenue, approximately 35% revenue only come from the non south markets. 65% come from South. South. You all of us know that the margins are only in the range of what 13% non south. The margins are in the range of 20% plus which might not be the case for the competitor which you mentioned in terms of south non south mix which I don’t know. But what we think is that it might not be that ratio. Right. Because we were born from the south.
Now come to franchisee revenue. Franchisee comes with almost half the margin because we have only 8% margin in franchise. So last three years we have been entirely growing through the poker model. Now the poker model revenue share is around 43% as of June. So these are the major two reasons for you to have a lesser gross margin when compared to or EBITDA margin when compared to the player whom you mentioned.
Dheeraj Mistri — Analyst
Got it sir. And sir, last time when you highlighted there was like a peak GML interest rate was there. And where are we right now? Is it back to the normal GML rate or again with the margin improvement trajectory? Is there any backward integration apart from what you mentioned in terms of sourcing benefit, Is there any other thing what you are trying to achieve to improve your margin going ahead? That would be my last question.
Amish Salyani Raman — Executive Director
Yeah. So gml GML is levels are back to what? September levels. Okay. And interest rates have come down to 4%. So that’s also almost back. Now what did you ask about backward integration? I just explained. So backward integration. I would actually do it in three steps. If you mean that backward integration is manufacturing. Okay. So manufacturing will not be there in the near term. Our primary focus for the near term will be to do a linear credit for vendors which will have a huge cost benefit. Already the pilot is done and successfully over two will be the jewelry park which I mentioned.
That will not be a margin driver but that will be an efficiency driver. Third will be the manufacturing but that’s not there in the near term.
Dheeraj Mistri — Analyst
Got it. Got it. Thank you. That’s it from my side.
operator
Thank you. We take the next question from the line of Pallavi Deshpande from Samiksha. Please proceed.
Pallavi Deshpande — Analyst
Yes sir. Thank you for taking my question. So just wanted to understand on this jewelry park and related to that how what percentage of our sourcing right now would be from non corporate vendors and yeah that would be my first Question.
Amish Salyani Raman — Executive Director
Yes. So for now we deal with contract manufacturers. Okay. And predominantly what studied, e.g. diamond, uncut, precious, Polki, those are all coming from what you call organized manufacturers. Even within gold, we have certain products which come from only organized manufacturers. Now our focus is on bringing the south based small vendors who are ready to work exclusively with us and grow along with us. We want to move them to the park, the manufacturing park which we are trying to create in Trishur, our hometown. They would work on even the studded and the non studded. Predominantly plain gold. But yes, some of the studded.
Pallavi Deshpande — Analyst
And so my second question would be on that advertising marketing spend, what was it for this quarter and was it similar last year? Same quarter.
Amish Salyani Raman — Executive Director
There have been what some leverage there because of the revenue growth. Right.
Pallavi Deshpande — Analyst
Lastly, in terms of this vendor strategy for the south, that would not impact any of your current contract or organized contract manufacturers or you could see an impact on them.
Amish Salyani Raman — Executive Director
So even within the contract manufacturer, the pilot, what we did was we on a particular sku, we reduced the number of contract manufacturers and gave them more work and asked them for a better pricing. So that was what we did for our regionalized contract manufacturers. So the pilot project is a mix of all those.
Pallavi Deshpande — Analyst
Thank you.
operator
Thank you. The next question is from the line of Ali Sagar Shakil from Motila Loswal Mutual Fund. Please proceed.
Ali Sagar Shakil — Analyst
Yeah, thanks a lot for the opportunity. Hi Anish, I just wanted to follow up on this question, sorry, this point you made regarding the vendor credit lines, can you just elaborate and what exactly we’re doing there and what kind of margin improvement that could bring.
Amish Salyani Raman — Executive Director
So as I told you, wherein we did the pilot, okay. We could use the available resources which we have to implement that. The pilot project, the amount invested, if you look at the return on capital, it was more than our corporate EBITDA in India. Okay, copy Rosie. Sorry. Yeah, so more than that I think it is too early for me to share.
Ali Sagar Shakil — Analyst
No, got it. But basically what you’re saying is that this pilot will now be expanded to a larger vendor base.
Amish Salyani Raman — Executive Director
Basically. Now it is ready to surely start in the regional brand from day one. Because the pilot is done and we know exactly the working, how it works, etc. To do it across Kalyan Jewelers. It needs lot of planning because it needs 15002000 crore. So we have to make the funds ready, partial or full or how, etc. Whether it is debt, whether it is funding, whether it is equity, whether it is partial, whether it is full, there is no clarity as we speak now that we will decide over the maybe next quarter or next couple of quarters and we will come back with a clear plan as to what we intend to do.
But the only takeaway is that the additional capital which we invested for this pilot fetched. Good Rosie.
Ali Sagar Shakil — Analyst
Understood. So basically you are reducing the credit lines that the vendors are providing which is kind of a margin as well as rocket. That’s the point you’re saying.
Amish Salyani Raman — Executive Director
So ROC accretive for sure. If ROC is accretive then margin is going to silvery go up because meaning that’s going to come to the bottom line.
Ali Sagar Shakil — Analyst
Understood. And can you just tell me right now what is the credit we take from vendors?
Amish Salyani Raman — Executive Director
Maybe it depends. It depends upon. It depends upon. It’s not a very vanilla easy question wherein gold comes with separate terms within gold, certain products in gold comes in separate terms. Precious stone come with separate terms. Diamond again comes with separate terms. But average the pay, the period of credit is around 30 to 33 days.
Ali Sagar Shakil — Analyst
Understood. And I mean from 30, 33 days, whatever we are taking credit lines generally what is the markup increase that happens because of that? Any broad idea?
Amish Salyani Raman — Executive Director
Again it depends upon product to product. So standard comes with a higher markup, gold comes with a lesser markup. So tough to explain on a call. But the only limited point I want to again reassure is that if capital is invested in that region, what we did in the pilot, the returns the ROCE are higher than our company Roshi India.
Ali Sagar Shakil — Analyst
Understood, got it. Thank you.
Amish Salyani Raman — Executive Director
Thank you so much for that elaborate experience.
operator
Thank you. The next question is from the line of Darusheel Zaveri from Crown Capital. Please proceed.
Darusheel Zaveri — Analyst
Hello, good evening sir. Thank you so much for taking my question. Firstly, congratulations on a great set of results sir. A lot of my questions have been already answered so just wanted to know like we, we had a fantastic Q1 so will we be able to, you know, continue this momentum in terms of growth of over 50% and a PBT of around 5% in the coming quarter as well. And like what’s our overall guidance for PBT this year?
Amish Salyani Raman — Executive Director
Sir, as of now demand looks robust. I told you the last couple of weeks cannot be compared because it had a larger base meaning heavier base in the last financial. We don’t see anything which can change when compared to Q1. We are actually very positive on this quarter as well. And PBT should be upper side of 5%.
Darusheel Zaveri — Analyst
Yeah, yeah. In the India, India only. And sir, just wanted to know in terms of Middle east, how is the market, you know, moving out there? Sir. And like Is there like a possibility of exposure, exporting more from the Middle east or how does it work out there?
Amish Salyani Raman — Executive Director
Sir, so if you look at the demand side, very strong. You look at Q1, the growth was around 27%, predominantly SSG and the July is also very strong. And we had actually achieved this 27% predominantly because of we renovating certain stores, relocating certain stores around seven, eight showrooms the last 612 months. And even in July the demand is very strong. Now coming to export? No, we don’t export as we speak. We don’t have export at all. We don’t even export to our own stores as we speak. Even from India or from.
Darusheel Zaveri — Analyst
Okay, okay, okay, okay, fair enough. Sir, I just wanted to know like our third, you know, format launch. So any kind of like what kind of investment are we going to be making in that, what in this current year and like how would that scale up?
Amish Salyani Raman — Executive Director
Sir, the initial investment for that regional brand will be in the range of 300 crore. We will open around five showrooms in the next 12 months for that regional brand. But post that it will be a focal moment. It will be completely. Because we now sit with a lot of franchisees who wants to come on board with Kalyan and if they that model should really work because stock trends are higher even though the margins are lesser. The rocees are good 18, 20% in our model. So I think the franchisee expansion will be the way forward for that regional brand.
But we wanted to do our own store, at least four or five with that regional brand before we gave it to give it to franchisees. We already have indicated to some of our existing franchise and we are getting positive feedback but we don’t want to test out with them because it’s a new brand. So we will launch the first five and then maybe even convert so that with that money we can open the next regional brand.
Darusheel Zaveri — Analyst
Okay, so for five stores, 300 capex. 300 crores capex will be on par. Or is it a bit higher side? Like just wanted to get an idea like what does the 300 CapEx also include?
Amish Salyani Raman — Executive Director
Yeah, predominantly it is inventory only. So you know that jewelry showroom, the initial one first of all will be flagship for the brand. We cannot go for a small format and investments are predominantly in inventory.
Darusheel Zaveri — Analyst
Okay, okay, okay, fair enough sir. And in terms of payback, like whatever kind of something that we are modeling, like the first, I’m assuming the first year would be similar to candier and will take time to, you know, grow its profitability. But what is our Expectations from this branch.
Amish Salyani Raman — Executive Director
So here it is unlike Candia because Candir you should understand that we were meaning it was. It was a what you call evolving segment. It was not an evolved segment where Candir was entering. Okay. This segment we are entering which is already evolved over years. And again Kalyan as a brand was also same 15 years before we actually came out from that positioning to a pan India to more standard, higher margin etc. So this is not going to take time like Candir because Candir was an online platform where we had to pump in lot of money on technology, manpower etc which was not our usual cup of cake.
But here, the first year itself it will be pat positive.
Darusheel Zaveri — Analyst
Oh okay. Okay. That. That’s. That’s really helpful to know sir. Yeah, that’s it from my side. So thank you so much. All the best.
operator
Thank you. We take the next question from the line of Naveen trivedi from Motilal OT1. Please proceed.
Naveen trivedi — Analyst
Just one question from my side. How should we look at the Indian business as spend? Considering first quarter we have seen more slattish kind of a spend. How should we look at the for the full year.
Amish Salyani Raman — Executive Director
The ad you are asking. Yeah. India. No.
Naveen trivedi — Analyst
Correct sir.
Amish Salyani Raman — Executive Director
Yeah. It should be in the range of Q1. Yeah. 1.5 meaning 1.5 range.
Naveen trivedi — Analyst
Okay. So last year we spent close to 1.8%. So you’re saying this here we should take it more like 1.48. 1.4. Yeah, yeah, yeah, yeah.
Amish Salyani Raman — Executive Director
Operating leverage will also chip in for ad also. No.
Naveen trivedi — Analyst
So it will be in the range of what?
Amish Salyani Raman — Executive Director
1.5.
Naveen trivedi — Analyst
Okay. Does it mean that as an absolute number which last year we spent close to 400 crores. It looks to us that given the size of the business absolute number is already has reached a level where we can keep capitalizing on on the business growth. And absolute number there can be a.
Amish Salyani Raman — Executive Director
Bit of a growth but it will not grow with the revenue.
Naveen trivedi — Analyst
Thank you.
Amish Salyani Raman — Executive Director
Add some amount because inflation, you know is there in all the sectors.
Naveen trivedi — Analyst
Perfect sir. That’s all for myself.
operator
Thank you. We take the next question from the line of Aditya Sharma from Shikara Investments. Please proceed.
Aditya Sharma — Analyst
Hi sir. Thanks for the opportunity. Two questions from my end. One, how is the pickup in the non south geography? The question is stemming from the SSG. So the North south geography is doing 16% while SSG for South is 20%. So I’m kind of surprised how matured region is doing better SSG than non mature stores. As the last part of the store expansion was happening in non south so could you just highlight on that?
Amish Salyani Raman — Executive Director
Yeah. So again, if you look at the last three, four quarters, it has been like that. Some quarters south will grow more than non south. Certain quarters non south will grow more than South. And even in mature stores, SSGs are strong because you know that the shift from unorganized to organized is increasing every year. And once we, once a customer comes into Kalyan, then it’s like a lifetime. So they keep on coming to Kalyan. And the brand is also getting popular day by day because we are expanding. So these are all the reasons.
Aditya Sharma — Analyst
Okay. Okay. Second question would be, can you throw. Some light on Candia, how the brand acceptance is taking place for the store shipping of what are the plans for the brand?
Amish Salyani Raman — Executive Director
So candir. Because we had increased our footprint and then we started our campaign. Campaign acceptance is good. We see huge traction at the store level. The revenue uptick for June July has been in the range of 75% plus. At the store level. Of course the base was low because Candid was a low revenue arm for us. But we see high positivity at the store level and Cander will end pat positive neutral by the end of the financial year.
Aditya Sharma — Analyst
Got it. Thank you.
operator
Thank you. We take the next question from the line of Bhavya Gandhi from Dalaland Docha Stockbroking, please proceed.
Bhavya Gandhi — Analyst
Yeah, hi. Congratulations on a very good set of numbers, sir. First question is regarding the leaner payable days. So what would be the payable days? Because you mentioned it’s currently around 30 to 33 days. So with the leaner structure, what would be the number like. Of it?
Amish Salyani Raman — Executive Director
Maybe 10 days and 12 days.
Bhavya Gandhi — Analyst
Right. For incremental 10 days, with the size that we operate, do we really require incremental 20 days also? Is it not possible to, sorry to use this word, but squeeze our vendors? Because with the size that we operate, we can even do that. Right? I mean we can extend the payable days.
Amish Salyani Raman — Executive Director
That we believe. Or even without me doing all that. Every vendor wants to work with us, right?
Bhavya Gandhi — Analyst
Right. Everyone has a capital. What you call the cost of capital is there for everybody. Right? So everyone has to make money. And we are here for the long run. So it is more than all that. We have to, we have to go and talk about the reality. We did the pilot, the credit period, we brought it down to one third. We got a huge cost efficiency there. And it’s a win win solution. Why go to that direction? Okay. Okay. And this is pilot project and the regional branch strategy. Are these two different strategies or they Are a part of one strategy. Slight got confused on that front. If you can throw some actually two strategies.
Amish Salyani Raman — Executive Director
But for the regional brand we have to have this linear because regional brands usually go with more price oriented what you call customer base. Wherein we will have to get the inventory at the maximum cost efficiency possible. So we wanted to do that for the region brand from day one. For which we wanted to do a pilot because we want to start it at the new brand. When we did the pilot, we could again reassure that the cost efficiency is very high, that we have to adapt it in Kalyan and we see high returns. Because if we do it in Kalyan fully.
So then we thought we should work it better in Delhi.
Bhavya Gandhi — Analyst
What would be the in house versus third party procurement at this point in time? Or everything is third party procurement Mostly.
Amish Salyani Raman — Executive Director
Because we work with contact manufacturers. No, we don’t have own manufacturing at all in India.
Bhavya Gandhi — Analyst
Right. And what would be the total debt figure that one should work out with for 26, 27 and 28.
Amish Salyani Raman — Executive Director
So now because I will give you clarity because now I told you we are taking a pause on the debt. Okay. And we are waiting for the collateral to come out. So if the collateral comes out say next month, we might again start the next set of repayment. Okay? So give us some more time because there are multiple projects going on. We might need some capital for our new project wherein we are trying to get exposure in the new project itself. Okay. Worst case scenario, if the new project we are not able to get exposure, we might have used the buffer which is there in Kailan to open the regional brand there.
So when we meet again, I will have a better answer is what I believe.
Bhavya Gandhi — Analyst
One last question if I can squeeze in very broad level question, sir. Organizers already reached 40% of the market share. How even in the mature markets. I mean penetrating beyond 50, 60% is difficult for even for organized players. There will always be a certain component of unorganized. So maybe five year view. I mean, do you still believe that there is shift that will continue or largely the shift has already been taken place.
Amish Salyani Raman — Executive Director
We believe that it will be a hundred percent organized segment the next five years.
Bhavya Gandhi — Analyst
Oh, okay, okay.
Amish Salyani Raman — Executive Director
And it does not. It does not mean that today’s all unorganized people will close their stores and everyone will come to customers will come to people like Alian. When I say hundred percent is because we still believe that the unorganized segment will convert to organized themselves. Because there are shopkeepers who were very unorganized maybe five, seven years before. Now they Are a semi organized business today and people in India, they will do business. No, they cannot go out of their business. But even if it becomes fully organized that way unfair practices will not be there.
Unfair advantages will not be there. Which is good for brands like.
Bhavya Gandhi — Analyst
Fair enough. Got it. Thank you so much. Really appreciate. Yeah, that’s it from my end. Thank you.
operator
Thank you. We take the next question from the line of Pallavi Deshpande from Samiksha. Please proceed.
Pallavi Deshpande — Analyst
You mentioned about the platinum and silver. So I wanted to know what would be the share of non 22 karat gold in the revenue mix and what was it last year?
Amish Salyani Raman — Executive Director
So non catalog is a bit of a. Because the diamonds completely almost comes non 22. But yeah. So uncur procedures etc. Comes with 22. Now some states in India, especially Bihar UP etc. The 18 karat revenues almost maybe 40% of the total gold revenue. But we as a brand are also trying to push 18 karat in other states because it will be easier for us to play in the because of the high gold price inflation over the last one or two years. So very tough to tell you exactly about aging cat revenue share.
Pallavi Deshpande — Analyst
My second question would be just on the previous one when you mentioned about organized share. Right. Going to 100. So if I want to look at organized as players who have a chain in more than one state, if I do that kind of a classification then what would be the share of organized in the next.
Amish Salyani Raman — Executive Director
Yeah, so but that calculation is a bit weird. No. You can even have a single shopkeeper can be an organized player. That should be the reality. You cannot expect everybody to have multiple showrooms and bucket that has organized.
Pallavi Deshpande — Analyst
Because the organized guys get an advantage of shifting inventory from one place to one state. If it doesn’t work here to that state. And that’s how. That’s. That’s an advantage. Right. So that’s not an advantage.
Amish Salyani Raman — Executive Director
It’s not. Meaning you cannot simply shift products from showroom to showroom because then that means that there is some issue with the planning because that is not going to be the major driving factor for our jewelry showroom success. So even now as we speak we have seen single jewelry showrooms. I don’t want to name the brand who competes more than other regional players in particular towns. Because if they do things right in their particular town, it is very tough to compete them.
Pallavi Deshpande — Analyst
Right. So what would be the share of old gold in exchange in your total revenue?
Amish Salyani Raman — Executive Director
So we will. Yeah. So you should look at B2C. It’s 25.
Pallavi Deshpande — Analyst
Thank you, sir.
operator
Thank you. Ladies and gentlemen, due to time constraints, we take that as the last question. And I would now like to hand the conference over to Mr. Ramesh Kalya Raman, sir, for closing comments. Over to you, sir.
Ramesh Kalayanaraman — Executive Director
Thank you very much and hope to see you soon again. Thank you very much.
operator
On behalf of Kalyan Jewellers India Limited. That concludes this conference. Thank you for joining us. And you may now disconnect your lines.