RENAISSANCE GLOBAL LTD (NSE: RGL) Q1 2026 Earnings Call dated Aug. 13, 2025
Corporate Participants:
Unidentified Speaker
Snehkumar Purohit — Corporate Strategy & Investor Relations
Sumit Niranjan Shah — Non-Executive Chairman and Global CEO
Darshil Shah — Managing Director
Analysts:
Unidentified Participant
Paresh Shah — Analyst
Shrikant Parakh — Analyst
Lohit Saini — Analyst
Presentation:
operator
Ladies and gentlemen, good day and welcome to the Renaissance Global Q1 FY26 earnings conference call. As a reminder, all participant lines will be in the listen only mode. There will be an opportunity for you to ask questions after the presentation concludes. Should you need any assistance during this conference, please signal an operator by pressing star and then zero on your touchstone telephones.
I now hand the conference over to Mr. Snehakumar Purohit from Renaissance Global. Thank you. And over to you, sir.
Snehkumar Purohit — Corporate Strategy & Investor Relations
Good afternoon everyone and thank you for joining us on Renaissance Global’s Q1FY26 earnings conference call. We have with us today Mr. Sumit Shah, Chairman and Global CEO and Mr. Darshul Shah, Managing Director of the company. We would like to begin the call with brief opening remarks from the management following which we will have the forum open for an interactive question and answer session. Before we start, I would like to point out that some statements made in today’s call may be forward looking in nature and a disclaimer to this effect has been included in the results presentation shared with you earlier.
I would now like to invite Mr. Sumit Shah to make his opening remarks.
Sumit Niranjan Shah — Non-Executive Chairman and Global CEO
Good afternoon everyone. On behalf of Renaissance Global, I extend a warm welcome and and thank you all for joining us on our earnings conference call for Q1FY26. I’ll begin with a strategic overview of our operational and business performance for the quarter. Following that, Darshul will take you through the financial highlights in great detail. We’re pleased to report a strong performance in Q1.26. Revenue from continuing operations grew 43% year over year reaching 530 crores in Q1.26, up from 372 crores in Q1.25. On the profitability front, profit after tax after adjusting for exceptional Items grew by 20% reaching 19 crores for the first quarter, up from 15 crores for the same period last year.
The performance is particularly noteworthy given the adverse impact of the uncompensated tariffs on our U.S. imports. Adjusting for the temporary tariffs, our Q1 performance highlights a strong underlying momentum. In our core business, the reported profit before tax before exceptional Items stood at 21 crores. However, while factoring in the tariff impact of about 11 crores, the adjusted operational PBT number rises to 32 crores reflecting an impressive 68% year over year growth. This significant improvement showcases a robust earnings potential of our business even in the face of external cost pressures. During Q1 FY26, we successfully concluded our cost optimization and rationalization program with the closure of our Bhavnagar facility.
The bold measures we undertook during FY25 to position our business for long term profitable growth have already begun to yield results. These initiatives contributed to operating savings of 12 crores in Q1 FY26 alone compared to the year before. This translates into an annualized saving of around 48 to 50 crores that we indicated earlier. Our financial position continues to strengthen with a significant improvement in the net debt to equity ratio reflecting our disciplined approach to deleveraging and a strong commitment to reducing further debt. As we look to the future, our priority is to grow our direct to consumer business both organically and inorganically.
High margin and low working capital requirements of this business make it an important part of our growth and transformation strategy. We also continue to make efforts to diversify our B2B business by pursuing growth opportunities in key international markets such as UK and Europe and Australia. This will help us mitigate geographic risks while fostering sustainable growth.
With that, I hand over the call to Darshil who will provide a comprehensive overview of our financial performance.
Darshil Shah — Managing Director
Thank you Sumit. Good day everyone. I am pleased to report a strong start to the fiscal year with consolidated revenue from operations crossing 530 crores marking a robust 43% growth compared to Q1 of FY25. Our brands under the D2C segment demonstrated remarkable resilience and growth with revenue increasing by 37% year over year reaching 69 crores. Customer brands also contributed significantly posting a 67% increase to 394 crores, underlining the growth, acceptance and reach of our products in the market. On the profitability front, I am pleased to share that we delivered a strong performance in Q1 FY26 despite facing significant headwinds during the quarter, our EBITDA stood at 41 crores reflecting a healthy year over year growth of 13%.
Profit before tax before exceptional items increased to 21 crores up by 11% compared to the same period last year. During the quarter we incurred an exceptional expense of 12 crores related to the discontinuation of operations at our Bhavnagar facility. This was a strategic decision aimed at optimizing our cost structure and enhancing overall efficiency. Importantly, the closure is not expected to have any adverse impact on our revenue and is anticipated to deliver meaningful savings in operating expenses going forward. Furthermore, our PAT, after adjusting for exceptional items rose by 21% to reach 19 crores against 15 crores in Q1 FY25.
Lastly, regarding our balance sheet, we remain focused on strengthening our financial position Our net debt to equity ratio improved to 0.19 in June 2025 compared to 0.31 for the same period last year. Our total net Debt stands at 276 crores at the end of June 25th which is lower by 95 crores from 370 crores at the end of Q1 of FY25. Our cash and bank balances along with current investments remain strong at 219 crores marking an increase of 33 crores from the same period at the end of last year. While we remain cautious of potential headwinds from the US Tariff changes and the challenging global macroeconomic environment, we are confident that our strength in product design, deep industry insight and strong distribution capabilities uniquely position us to seize long term growth opportunities. We will continue to focus on scaling our high growth owned brand business and expanding our portfolio of brands to drive sustainable value for our stakeholders. Thank you.
Questions and Answers:
operator
So, should we proceed with questions?
Darshil Shah
Yes,
Sumit Niranjan Shah
yes,
operator
thank you very much. We will now begin with a question and answer session. Anyone who wishes to ask a question may press Star and one on the touch tone telephones. If you wish to remove yourself from the queue, you may enter Star and 2. Participants are requested to use only handsets while asking a question. Ladies and gentlemen, we will wait for a moment while the question queue assembles. The first question is from the line of Paresh Shah from Global Investments. Please go ahead.
Paresh Shah
Hi, can you hear me?
operator
Yes sir. Please go ahead.
Paresh Shah
Yeah, I had this one, I mean few questions but the first question to start with, you know when I was looking at the balance sheet and the P and L account right from 2018 on financial year we have been consistently, consistently at around 1800 crore kind of top line with net profit, you know, ballpark in the range of 75 to 80 crore and ROEs, you know, subpar and you know, but in the same time if you look at the balance sheet, the inventory days have gone up for almost 150 odd days which also seem to be higher to almost like 250 days. And more than that the receivable days has gone up from you know, 70 days, 60 days to almost 124 days. How should one look at that, you know, I mean how do you look at that as a promoter when you are looking at the company for last almost eight, nine years.
Sumit Niranjan Shah
Yeah. Okay. So to answer your question, the numbers are not comparable because in 2018 we had an 800 crore gold jewelry business which we sold last year in August. So you know that gold jewelry business was had a top line of 800 crores delivering very little to the bottom line. And we changed accounting policies later so that 1800 crores actually is 1000 crores. Because the gold division at that time accounted for 800 crores in revenue. Our profits had grown from 7080 crores up to 100 crores in FY22, 105 crores was the peak. And, and last two years profits have declined because of which we have undertaken a cost reduction exercise as we have mentioned of 50 crore rupees annually in this quarter. There is a 12 crore saving compared to last year. So I mean when one looks at 80 crores plus a 50 crore cost savings, you will see what the numbers will be at the end of the year. So that’s how we are looking at it. As a promoter.
operator
It appears this line has got disconnected. We’ll wait for further questions.
Sumit Niranjan Shah
Yep.
operator
Participants, if you have any questions at this time, you may enter star and one on your touchstone telephones. The next question is from the line of Srikanth Parikh from Prudent Investments. Please go ahead.
Shrikant Parakh
Hello, good afternoon. First of all very conversation for your quarterly numbers despite all the tariff pressures. So my first question is on that key, shall we conclude now that the all the restructuring related expenses or the activity has been concluded and there will be no further ongoing or spillover restructuring cost in the next quarter?
Sumit Niranjan Shah
Yes, absolutely correct.
Shrikant Parakh
Okay. And with this new tariff regime which has been revised and which will be applicable, partially applicable from 1st of August and then partially applicable from 27th August. So how are we are assessing ourselves of competitiveness from other countries or visa with other players from other countries. Will we be having some kind of an additional pressure due to this revised tariff structure?
Sumit Niranjan Shah
Yeah. So at the moment, you know, customers have, you know a lot of the fine jewelry supply chain is in India. Customers have accepted, you know, the current tariffs and you know while in April there was a time delay in terms of passing on the tariffs, we do not anticipate any delay in being able to pass on the tariff impact and we’re evaluating multiple supply chain routes because we do have a global supply chain in terms of ability to manufacture. So we are quite confident in our ability to navigate the tariff situation. We had indicated last quarter that there will be an impact which will be absorbed which was to the tune of about 10 crores is what I had indicated in the last call. The final number came at about 11. I do not anticipate any impact due to tariff in the coming quarter. We’ve been able to Conclude negotiations and discussions with all customers where tariffs will be passed on.
Shrikant Parakh
Okay, so but does that increase the final cost or that cost of our product or that is something which we don’t mind that we have left to our customers?
Sumit Niranjan Shah
Yeah, I think, you know, the new reality is that, you know, costs will go up because you know, any country in the jewelry supply chain is at around 20%. Right. I mean the competitors who manufacture jewelry, Thailand being at 19, China being at 35 and India being at 25 at the moment doesn’t put us in a significantly disadvantageous situation. So you know, we feel that, you know, this is a new reality. You know, how that impacts demand obviously is yet to be seen in this quarter. There has been no impact. In fact, you’ve seen the numbers have been very strong.
Consumer demand in the US continues to be resilient. I think it will have to be a wait and watch approach to see the demand on the product as the price increases. I think from what I understand, most retailers are taking a cautious approach to increasing price. And since these guys have high gross margins, 65 to 70%, you know, it meaningfully maybe dilutes margins by 2 to 3% if they take a tariff impact. So I think some amount will be passed on to the consumers, some amount may be absorbed by the retailers. So I think that it’s something that we’ll have to wait and see the impact on demand with the price increases that are taken by retailers.
Shrikant Parakh
Okay, and one last question. Since a lot of tariff and this were going on, so was there any kind of an advanced sales booking due to upcoming tariffs in the current quarter?
Sumit Niranjan Shah
You know, to a certain extent. To a certain extent, yes. But you know, I think that our, you know, over the last couple of years, you know, the sales in our customer brand segment has, has been challenged because we were slow to migrate to lab grown diamonds. I think, you know, a lot of we were very cautious in the transition to lab grown diamonds because the prices of lab grown diamonds were falling significantly. You know, we’ we’ve kind of transitioned fully now to lab grown diamonds and a lot of the customer brands growth is on account of what we’re seeing.
Right. We’ve mentioned that we first focused on lab grown diamonds Primarily in our D2C area which has shown resilient growth. And now on the B2B segment as well, we’ve sort of transitioned to lab grown diamonds because of which we’re seeing this growth. But there is some pre booking. I mean obviously 67% growth in customer brands is not sustainable. There is some amount of pre booking but overall we do see a healthy demand environment.
Shrikant Parakh
Okay, that’s what from outside. I will once again get back.
Sumit Niranjan Shah
Thank you.
operator
Thank you participants. If you have any questions at this time you may enter Star and one on your touchstone telephones. The next question is from Paresh Shah Global Investments. Please go ahead.
Paresh Shah
Sorry, I actually dropped off from the line. So that was the first question. So while I do understand there has been a product mix change, right. Which has led to our turnover increasing and profitability remaining same despite.
Sumit Niranjan Shah
No, it’s the other way parish. Sorry to interrupt you. It’s the other way around. At that time there was a gold jewelry business which has now been discontinued. So the sales of diamond jewelry which we are now doing was a thousand crores which is now 2000 crores. And on the profitability front, I’m not sure if you heard while our sales were challenged due to us being cautious in entering lab grown, we are seeing a catch up of that now. And as I mentioned we have undertaken a cost reduction exercise of more than 50 crores. Our profit after tax last year was in the 70 to 80 crore range where the cost reduction exercise was not in the numbers.
So you will see that this year there has been a 12 crore reduction in cost compared to the same quarter last year. So this should show up in the numbers going forward because we do not expect our gross margin to decline. And with operating expenses going down by 50 crores this should translate into a healthier, healthier bottom line.
Paresh Shah
And what explains the working capital deterioration then? Sir, if you may help understand.
Sumit Niranjan Shah
So. So the working capital deterioration is also a function of the gold business being 15 days receivable. It was always this on the diamond jewelry business. So there isn’t a deterioration. The denominator is different which is the sales, which is what is sort of masking the numbers.
Paresh Shah
Sorry, if I compare.
Sumit Niranjan Shah
Sorry. On diamond jewelry, on diamond jewelry the working capital the inventory is always six months. Whereas seven years ago there was diamond jewelry was only 1000 crores out of the 1800 crores. Gold jewelry has a 15 day working capital. So when you isolate from seven years ago the numbers into two parts, gold jewelry and diamond jewelry, the working capital cycle was always the same.
Paresh Shah
So if I just Compare plain vanilla March 24 to 25 where I am sure the same line of business and there is no gold business that we did there. Also our inventory days which were 84.
Sumit Niranjan Shah
March, March 24, March 24, the gold business was still there. The gold business was sold in August of 24, sir, that is seven months ago.
Paresh Shah
So should we assume that this new receivable cycle of 124 days will continue the day.
Sumit Niranjan Shah
The receivable days will go down to 90. In March the number was higher because we do a lot of sales in December and a lot of collections happen in March and April. The receivable number should be between 90 and 95 days. March is an aberration and it will normalize to 90 to 95 days. Receivables inventory will be six months. So the cadence and guidance should be six months inventory, 90 days receivables.
Paresh Shah
Right. So when we see the September balance sheet we will have data days of 90 days. Is that understanding? Right?
Sumit Niranjan Shah
That that should be. That should be correct.
Paresh Shah
Right. And how, how should we look at, you know, I mean you did explain this time around we having a tariff impact and therefore or an impact of 11 odd crores. Right. But then do we see more of these write offs or are we done? And now basically we have a clean slate from here on. How should we do that? Because we have been seeing.
operator
Sir, it appears his line has been disconnected again. Participants with Questions may enter STAR and 1. We have the next question from the line of Lohit Saini from JRM Stock brokers. Please go ahead.
Lohit Saini
Hello. Am I audible?
operator
Yes, sir.
Lohit Saini
Thank you so much for the presentation. I wanted to know like, considering yesterday there was a news. 1 lakh workers in Gujarat were laid off. Diamond workers. So how do we see the diamond market ahead with the tariffs? Like gold prices are rising, silver prices are rising. So how is the market ahead? And the second question, are we considering any other geographies other than eu, UK and us?
Sumit Niranjan Shah
Thank you. Yeah, thanks. So you know, currently I think we are not seeing any impact on demand. You know, obviously between our B2B business as well as direct to consumer businesses both in Europe, Canada and in the US Demand continues to remain healthy and resilient, which is reflecting in our numbers. I think obviously some of the tariff impacts have not been passed on to the consumers. However, if you were to take a historical context compared to one year ago, gold prices have increased by more than 50% in the last 18 months which have been passed on to consumers without any impact on.
So I mean while 20% is 25% is a big number, you know, it’s something that will have to be passed on to consumers because clearly neither the retailer nor the manufacturer has the margins to absorb this. How this impacts demand obviously is an unknown. Just some historical context that, you know, gold has increased and Obviously retailers have taken price increases to this effect whether it’s in India or any other geography without any tangible impact on demand.
Lohit Saini
Okay. And sir, what about the other geographies? Are we considering any other countries?
Sumit Niranjan Shah
Currently our mix is, you know, 65, 35. You know, we have a very small India business and we are looking at opportunities to grow in continental Europe as well as the UK and we see those as growth markets. Those efforts are ongoing. Having said that, US is 50% of the world’s consumption of diamond jewelry and we will remain dependent on that market. I mean there is no way to diversify this overnight.
Lohit Saini
Okay. All right. Sir, can I ask one more question?
Sumit Niranjan Shah
Please go ahead sir.
Lohit Saini
Last few years there was a good rally in Indian stock market. So consumer did not mind spending on the gold price. But this year hasn’t been like that. The stock market isn’t that good. So maybe this wedding season there will be an impact on, on the sales. I feel so.
Sumit Niranjan Shah
Yeah. So I think that may be the case in India. I mean our sales in India are about 1.2% of our sales. So it’s not material for us. I mean obviously consumer demand in us, Canada and UK is more important for us. And again, as I said, what impact the tariffs have on consumer demand is unknown. So far with the 10% being passed on, there isn’t any noticeable impact. If that does have an impact for the other 10 to 15% that needs to be passed on, it’s to be seen.
Lohit Saini
All right, thank you so much, sir.
operator
Thank you. The next question is from the line of Srikanth Parik from Prudent Investments. Please go ahead.
Shrikant Parakh
Hello. So my question is on our domestic businesses, what’s the ongoing strategy with, you know, with us how we are looking into it because last time we said that we will be going with how the demand is getting shaped up into the Indian markets and that’s how you’ve been more stored. So can you give us an update on that? What the real progress going out out there?
Sumit Niranjan Shah
Yeah, we haven’t seen much improvement in the demand in our domestic business. And we’re obviously going to be very cautious about increasing our physical footprint before the business model is figured out. So it’s a small business, it’s around 25 crores in annual revenue. And unless we don’t see the unit economics pan out, we are going to be very cautious about expanding Iraswa. So we’re in wait and watch mode as of right now.
Shrikant Parakh
Okay, so that was from my side. Thank you.
Sumit Niranjan Shah
Thank you.
operator
Thank you ladies and Gentlemen, if you have any questions at this time, you may enter Star and One on your touchstone telephones to ask a question. Please enter Star and One. We have a question from Srikanth Parit from Prudent Investments. Please go ahead.
Shrikant Parakh
Okay, so while you were giving the details about the financial. As a company, we are also weighing an option. Since we have a global footprint of the supply chain, we could transfer some of the businesses to some other supply chain countries also. So how quickly this turnaround time is there, if, if there any possibility we have to move our businesses to a different source of origin?
Sumit Niranjan Shah
Yeah. So I think that as of right now, I think we’ve got plans in place for risk mitigation, which gives me confidence that there will not be any tariff impact. I think that the specifics of the strategy we’d like to keep confidential for competitive reasons. But as I mentioned last quarter, there will be an impact this quarter. We feel that we are much better prepared knowing the context of what’s happening and we feel fully confident that we will be able to mitigate the impact of any tariffs going forward. The specifics of the supply chain we’d like to keep confidential for competitive reasons.
Shrikant Parakh
Yeah, totally understood. Just to get a context for our analysis, any ballpark figure or in a percentage of sales which can come as a one, as a cost for shifting to different supply chain routes,
Sumit Niranjan Shah
it will be insignificant.
Shrikant Parakh
It will be. Thank you. Thank you.
operator
Thank you, participants. If you have any questions, please enter Star and 1. As there are no further questions from participants, I now hand the conference over to Mr. Sumit Shah for closing comments.
Sumit Niranjan Shah
Thank you everyone for joining us on the Q1 26 conference call. If you have any more questions, please feel free to contact our investor relations team.
operator
Thank you very much. Thank you on behalf of Renaissance Global. That concludes this conference call. Thank you all for joining us. And you may now disconnect your lines. Thank you.