Bluestone Jewellery IPO

Its focus on diamond jewellery and efficient product portfolio management has led to gross margins of 37.94% in FY25 (it kept nearly ₹38 from every ₹100 sale after covering the cost of making the jewellery, but before paying for salaries, rent, marketing, and other business expenses), which is among the highest for leading jewellery retailers in India.

It is recognized as the fastest-growing jewellery retailer in India from FY21 to FY24. This is evident from its year-on-year revenue growth of 64.24% in FY24, which outpaces its listed industry peers with over ₹500 crore revenue and more than 50 physical stores.

It has built a healthy omni-channel retail network, with 275 stores in 117 cities, and 298.87 million website visits as of FY25. The number of customers (life till date) has grown 40.5% annually between FY23 to FY25 to reach 7.71 lakh.

The company also managed to grow its number of stores and number of cities at an annual rate of 33.2% and 28.4% during FY23 to FY25. The average order value also increased at 22% annually during the same period.

The company shows strong repeat customer engagement, with a Repeat Revenue Ratio of 44.61% in FY25. This indicates its ability to keep customers coming back, contributing to steady revenue growth.

It uses an in-house technology system that connects everything from design to sales, helping to optimize inventory and achieve faster inventory turns (1.34 in FY25) compared to the industry. If BlueStone had ₹100 worth of jewellery on average, it sold ₹134 during the year by continuously adding new stock as older pieces were sold.

Its stores demonstrate strong financial performance, with 75% breaking even within three months. Stores open for more than three years generated an average of ₹76.8 lakh per month in FY25.

In terms of sales during FY25, BlueStone is the smallest player among the listed peers with ₹1,770 crore sales, which is nearly 20% less than the immediate next company in terms of sales.

The company has not generated profits since its start, reporting losses of ₹221.84 crore in FY25. Even the losses have increased at an annual rate of 15.2% from FY23 to FY25.

It also experienced negative cash flows from operations, amounting to ₹665.83 crore in FY25. This could impact its ability to fund operations and growth plans in the future.

The business needs a lot of working capital, primarily for inventory. Its total borrowings reached ₹729 crore by March 31, 2025, growing 78.6% annually between FY23 and FY25, with a significant portion for working capital, increasing financial strain if not managed well.

Its inventory was ₹1,652.55 crore as of March 31, 2025, representing 93.36% of revenue from operations. Ineffective inventory management could lead to increased costs or an inability to meet demand.

Despite its digital-first branding, most sales occur offline. 93.34% of its revenue in FY25 came from stores and other physical channels. This strong dependence on physical locations makes it vulnerable to local market shifts or disruptions.

The cost of gold and diamonds made up 101.74% of its material costs in FY25. Fluctuations in these commodity prices can greatly affect its inventory value and profitability.

The Indian jewellery market is highly competitive, and its inability to compete effectively on pricing, product, or marketing against both domestic and international players could impact market share and profit margins.