Summary
Renaissance Global Limited - Q3 FY 2026 Earnings Call Summary Friday, February 13, 2026 14:00
Event Participants
Executives 2 Darshil Shah (Managing Director), Sumit Shah (Chairman and Global CEO)
Analysts 6 Divhy Gosar (Subhkam Ventures), Majid Ahamed (PinPoint X Capital), Palash Kawale (Nuvama Wealth Management), Pawan (Individual Investor), Riddhesh Gandhi (Discover Capital), Shashank Jain (Delhi Family Office), Shrut Bhayani (Areeza India), Sudhir Bheda (Bheda Family Office)
Financials & KPIs
| Metric | Reported | Commentary |
|---|---|---|
| Core Revenue (Ex-Bullion) | ₹824 crores | +16% YoY; Growth driven by own brands and D2C momentum despite metal price headwinds. |
| D2C Revenue (U.S.) | ₹89 crores | +50% YoY; Annualized run rate reached ₹300 crores. |
| EBITDA | ₹63 crores | +19.6% YoY; Margin at 7.7% reflecting early operating leverage. |
| Adjusted PAT | ₹33 crores | +36.5% YoY; Improved profitability conversion through disciplined cost control. |
| 9M Core Revenue | ₹1,886 crores | +28% YoY; Reflects structural shift toward branded jewelry platform. |
| 9M D2C EBITDA Margin | 11% | +300 bps YoY expansion from 8% due to scale and marketing efficiencies. |
| Inventory Days | 140 days | Reduced from 166 days in Sep; Improvement driven by exiting consignment-heavy B2B accounts. |
| Debtor Days | ~90 days | Stable; Management targeting further reductions through client rationalization. |
Geographic & Segment Commentary
- U.S. Direct-to-Consumer (D2C): Revenue expanded 50% YoY in Q3, with EBITDA growing 92% for the 9-month period. Management is utilizing a “zero-inventory” digital model and luxury positioning to drive margins, with Jean Dousset serving as a high-margin luxury anchor.
- Manufacturing (UAE): Operations have shifted to a new facility in the Middle East to bypass 18% India import tariffs. While setup costs impacted recent margins, the facility is now fully operational, leading to the cessation of bullion sales by late February 2026.
- Licensed Brands: Segment saw margin compression to 13.3% from 14.8% as the company discontinued “fringe” licenses to focus on the core Disney partnership. A recovery to 15% margins is anticipated by FY27 following volume stabilization.
- India (Irasva): Management remains in “wait and watch” mode, citing dissatisfaction with current unit economics. No significant capital allocation is planned for the domestic retail segment in the near term.
Company-Specific & Strategic Commentary
- Brand Transformation: The company is transitioning from a volume-led B2B exporter to a premium brand-led platform, with own brands now serving as the primary growth engine.
- B2B Client Rationalization: Management is actively exiting low-ROE, consignment-heavy B2B accounts to improve the cash conversion cycle and capital efficiency.
- Jean Dousset Expansion: Strategy involves scaling from 2 to 5 physical boutiques by the end of calendar year 2026. Three new locations are slated to open in July, September, and November 2026 with a ₹25 crore budget for capex and working capital.
- Cost Optimization: A major cost-saving initiative implemented a year ago has yielded ₹36 crores in savings (excluding advertising) over the first 9 months of FY26.
Guidance & Outlook
| Metric | Guidance / Outlook | Commentary |
|---|---|---|
| Revenue Growth | 15% - 16% (Core) | Perceived as sustainable baseline; FY26 reported growth will be higher due to one-time bullion sales. |
| EBITDA Margin | Double Digits | Targeted over a 2-3 year horizon as D2C mix reaches 20-25% of total sales. |
| ROCE / ROE | Mid-20s% | 3-year aspirational goal driven by shift to asset-light, negative working capital D2C models. |
| Bullion Sales | ~₹80 crores (Q4) | Expected to wind down completely from Q1 FY27 as internal manufacturing fully replaces outsourcing. |
Risks & Constraints
| Risk | Context |
|---|---|
| Raw Material Volatility | Metal price increases are creating “short-term turbulence”; while D2C margins are resilient (65% gross), B2B demand impact remains uncertain. |
| Working Capital Cycle | Introduction of UAE manufacturing has temporarily lengthened the cycle; current inventory stands at 140 days with a goal to reduce via client exits. |
| Geopolitical/Tariff Risks | Management navigated 18% India tariffs by shifting to UAE, but ongoing geopolitical shifts remain a monitorable for U.S. consumer sentiment. |
Q&A Highlights
Margin & Cost Savings
- Question: Where are the reported ₹40 crore cost savings reflected given 7% margins? (Sudhir Bheda)
- Answer: Excluding advertising, 9M expenses are down ₹36 crores. Reported margins are optically suppressed by zero-margin bullion sales in the denominator; PBT actually grew 31% on 16% core revenue growth (Sumit Shah).
Inventory & Cash Cycle
- Question: Why has the cash conversion cycle remained high despite exiting low-ROCE businesses? (Riddhesh Gandhi)
- Answer: UAE manufacturing setup lengthened the cycle temporarily as metal is bought in Dubai before processing. Furthermore, lab-grown diamond shifts have shortened payable days, requiring more upfront funding (Sumit Shah).
Direct-to-Consumer (D2C)
- Question: Is the D2C segment achieving true operating leverage? (Riddhesh Gandhi)
- Answer: Yes; 50% revenue growth resulted in 90% operating profit growth for D2C, driven by marketing efficiencies and spreading overhead across a larger base (Sumit Shah).
Metal Price Impact
- Question: How are rising gold prices affecting U.S. demand? (Pawan)
- Answer: U.S. jewelry follows an MRP model, not daily metal pricing. While D2C has taken calibrated increases with no demand impact, the B2B segment may see pressure as retailers pass on costs later (Sumit Shah).
Key Takeaway
Renaissance Global delivered a strong Q3 FY26, characterized by 16% core revenue growth and a 36% increase in adjusted PAT, marking a successful pivot toward a brand-led jewelry platform. The U.S. D2C business emerged as the standout performer, growing 50% YoY and reaching a ₹300 crore annualized run rate with expanding 11% EBITDA margins. Structurally, the company shifted manufacturing to the UAE to mitigate Indian tariffs, a move that increased short-term working capital but secured long-term competitiveness. Management remains focused on improving capital efficiency by exiting consignment-heavy B2B accounts and scaling the high-ticket Jean Dousset brand to 5 stores by end-2026. While metal price volatility and a 140-day inventory cycle remain near-term watch points, the company is trending toward its long-term goal of double-digit operating margins and mid-20s ROCE by FY28/29.
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