Senco Gold Stock: Emkay Global recommends BUY, sets Rs 500 share target price
Emkay Global maintains a 'BUY' rating for Senco Gold, setting a Rs 500 target price, projecting 58% upside. The brokerage firm is confident due to strong growth outlook (22-23% by FY26), improved EBITDA margins, and attractive valuation.
New Delhi: Brokerage firm Emkay Global has retained its trust in Senco Gold. The brokerage firm has reiterated the BUY rating on it i.e. recommended buying it. The company's shares were trading at Rs 316.40 at the time of writing this article. The brokerage firm has expressed confidence in the company due to its increasing growth outlook, better margin estimates, increasing franchise interest and attractive valuation. Let's find out what the target price has been set by the brokerage.
Senco Gold share target price
Emkay has set a share target price of Rs 500, giving a BUY rating for Senco Gold. That means the brokerage has estimated a rise of 58 percent from its current price.
According to the brokerage report, the company's sales may improve rapidly by the third quarter after a weak 6.5% retail growth in the second quarter. Now the growth forecast for FY26 has risen to 22-23% from 18-20% earlier. At the same time, EBITDA margin is also expected to reach 7.2-7.4%. Emkay Global believes that the company's RoE could improve by around 15% by FY28.
Senco Gold valuation and asset base
According to the brokerage, Senco Gold is currently trading at an attractive valuation. The company has liquid net assets worth close to Rs 40 billion, while lifetime brand marketing expenses of Rs 8 billion are also strengthening its value.
The company's marketing investment has created a 3 million customer base and 80 franchises.
Franchisee's interest in non-eastern regions has increased rapidly.
The company has a strong grip in eastern India. 104 stores are present in 60 cities.
Growth in the North and other regions will gain momentum in the coming years.
Lightweight design, focus on GenZ and Affluent customers
According to the brokerage, Senco has mastered light weight jewellery over the years. This strategy enables him to deliver superior designs to customers with less weight. The company is also targeting premium and GenZ customers through formats like D'Signia and Everlite.
According to the brokerage, West Bengal remains a strong stronghold for Senco, but now the company is rapidly expanding in non-east areas like Gwalior and Bikaner through a franchise model. It is getting easier due to light-weight design and long experience.
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