S&P rates Kalyan Jewellers, notes B

S&P said it gave preliminary B ratings to Kalyan Jewellers India Ltd. and the planned senior secured notes to be issued by subsidiary Kalyan Jewellers FZE. The parent will guarantee the notes.

“Kalyan Jewellers' business position is constrained by its small scale of operations, and weaker profit margin compared to global peers, partially tempered by good brand recognition and favorable growth prospects. Kalyan Jewellers operates in the highly fragmented and competitive India jewelry retail market. While it is the second-largest pan-India jewelry retailer, its market share was only about 2% of the country's $60 billion jewelry retail market,” S&P said in a press release.

“We forecast Kalyan Jewellers will post 10%-12% revenue growth over fiscals 2023 and 2024, on the back of a 20%-25% growth in fiscal 2022,” the agency said.

Kalyan Jewellers will use the proceeds to refinance most of its short-term debt.

The outlook is stable.

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