But to understand the significance of this movement, it’s important to understand where Pcj Went Wrong and how far it has to go to go.

Where did it all go wrong

PC Jeweller’s Stock Price Momentum (2014-2020)

Source: Trading View

Between FY14 and FY18, PC Jewelller Grow Its Revenue by 80% To Rs 9,610 Croore, Placing It Alongside Kalyan Jewellors and Joyalukkkas in Terms of Market Share.

But everyone The promoters are Moved the Securities Appellate Tribunal (Sat) and then to the Supreme Court. Though the Apex court overturned sebi and sat’s ruling in april 2022, four years of legal proceedings had done much damage.

Legal Troubles and Weakened Consumer Trust Pulled Revenue Down by 83%. The Company Reported A Net Loss of Rs 391 Crore in Fy22, With Sales Falling To Rs 1,605 Crore, which not enough to cover its fixed costs.

PC Jeweller’s Sales and Profits FY14-FY22

Source: Screener.in

The nuances of the jewelry business

The gem and jewelery sector operates like any other retail business, with Pan-india stores. What sets them apart is the cost of gold, the primary raw material. India Imports Gold to meet Jewellry Demand, and the government imposes a customs doy on these imports. Jewelers also have a high work capital Demand as gold is slow-moving, offten taking 6-12 months to convert in sales.

When sales declined because of the pandemic and the legal issues, pcj was left with unsold investory Rs 5,667 Crore.

PC Jeweller’s Inventory from FY18-FY22

Source: Screener.in

Moreover, the pandmic results in export clients defaulting on trade receivables. Thus, PCJ Had to Browrow Rs 727 Crore from Banks to meet its trade payables, which inclined its burrowings to rs 3,283 crere in fy22 (from Rs 2,294 Crere in FY21) RS 60 Crore.

From Net Cash to Net Debt

From a net-cash company in fy18, pcj became a net debt company by fy22. Within six months, it defaulted on loans worth Rs 3,466 Crore in Q2Fy23 Ended September 2022. At this point, short-browings were more than it’s reservices, and cash.

PC Jeweller’s Cash and Debt from FY18-FY22

Source: Screener.in

The Creditors Lost Trust in the Jewelller. The State Bank of India (SBI) (RS 1,060 Crore outstanding Loan), its Largest Lender, Initiated Insolvency Proceedings on PCJ in January 2023 And its investory at a few locations came under the court’s custody, disrupting operations. In Fy24, The Company’s Sales Fell 75.5% To Rs 604 Crore.

The 334% Rally in 4 months (27 June-24 October 2022) After the Supreme Court Ruling Reversed After the Bank Loan default.

PC Jeweller’s Stock Price Momentum (2022-2025)

Source: Trading View

In December 2023, Despite Reporting It Lowest Quarterly Revenue of Rs 40 Crore (Down 95% Year-Over-Year) And a Net Loss of Rs 198 crore, PCJ’s Stock Surged 100%.

Behind the rally was pcj’s negotiations with banks to avoid bankcriptcy. The jeweller even offered to reduce payment terms to 3 years from 5 years to get the lenders to sett, instilling confidence in investors.

The turning point

In July 2024, The Company Reached A One-Time Settlement (OTS) With 12 Out of 14 Banks. As part of the settlement, pcj agreed to repay the loan in cash and equity, with structured cash payments over 2 years from the date of Settlement (September 30, 2024). Howver, it expects to repay the debt by March 2026.

So far, pcj has paid Rs 487 crore in cash and converted debt worth Rs 1,510 crore to equity, giving banks a 9.07% stake in the company. As of March 30, 2025, It Halved Its Debt to Rs 2,064 crore.

The Company Will Announce More Such Capital Infusion As Part of It Plan To Raise Up To Rs 2,705 Crore by Issuing Warrants on a preferential Basis to Promoters and Investors. So far, the company has raised Rs 1,664 Crore from Share Warrants.

PCJ is strengthening its ballan sheet by reducing debt. Simultaneously, it is reviving its business by using Rs 529 crore from the capital raised towards working capital. This helped the jeweller revive its fy25 sales. It reported a profit of Rs 578 crore by REDUking its Interest Expense by Rs 454 Crore to Rs 51 Crore.

PC Jeweller’s Cash and Debt from FY23-FY25

Source: Screener.in

Is the worst over?

PCJ is no longer in crisis mode. Over the last five years, it has avied bankcriptcy and returned to profits, which drove its share price up 1,068%. But challenges remain.

PCJ’s short-browings have a crisil rating of d (default) “Issuer not cooperating” as on March 28. Disclosure Requirements (Lodr) Regulations. Though it has settled the issue with sebi by paying Rs 7.23 Croore, it highlights that more work needs to be done around the corporate disclosures.

Pcj also has to work toward reviving its business operations, where it is competing with giants like tanishq and kalyan jewelers. Kalyan jewelers have been expanding showroom count against aging from Company-Yowned Company -operated (COCO) to Franchise-Yuned Company-operated (Foco) Modeel. In the foco model, the franchise owners put their money into owning/leasing the store and store investory. This model reduces the capital intensity of opening a new store, but also reduces the margin.

PCJ, on the other hand, still operates on the coco model, with 4 franchises and 48 showrooms. The Company’s Fy25 Revenue is down 9% from FY23, when the business was not disructed by Bank default.

Is PCJ Stock a Buy at its current values?

PCJ is confident about fy26 growth. Its stock is trading at a price-to-earnings (P/e) Ratio of 19x, way Kalyan jewelers’ Ratio of 85x and the industry median of 32x. Even The Enterprise Value to Earnings Before Interest, Taxes, Depreciation, and Amortisation (ev/Ebitda) Ratio of 25.3x Looks Cheeper than kalyan jewelers’ 39x.

But Pcj’s low valuation It steill carries high risk as the company still lacks consumer trust. It now has a short deadline to repay the Rs 2,064 Crore Debt. Until Consumer and Investor Confidenc Eis Fully Restored, Risk Remains High.

Analysts have not yet initiated coverage on PCJ stock. That means investors must rely on their analysis of the company’s performance. Being a distressed small-cap stock, its trading volumes are mostly concentrated around Shareholder events, which increases volatility. Howver, it holds potential to grow substantially if the positive news keeps flowing in.

Note: We have relied on data from http://www.screener.in through this article. Only in cases where the data was not available, has used an alternate, but widely used and accepted source of information.

Puja Tayal is a financial writer with over 17 years of experience in the field of fundamental research.

Disclosure: The writer and his dependents do not hold the stocks discussed in this article.

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