Management

• Gaurav Singh Kushwaha (Chairman, Managing Director, and Chief Executive Officer)
• Prashanth Prakash (Non-Executive Nominee Director)
• Sameer Dileep Nath (Non-Executive Nominee Director)
• Rajesh Kumar Dahiya (Independent Director)
• Rohit Bhasin (Independent Director)
• Neha (Independent Director)
• Rumit Dugar (Chief Financial Officer)

Use of Proceeds

The total issue size is Rs. 1,540.65 cr, which comprises of fresh issue of Rs 820 cr and offer for sale (OFS) of Rs 720.65 cr. The company intends to utilize a portion of the net proceeds towards funding its working capital requirements (Rs 750 cr), and the rest for general corporate purposes

Competitive Strengths

Second largest digital-first jewellery brands in India offering an omni-channel retail experience BlueStone is the second largest digital-first omni-channel jewellery brand in India by FY 2024 revenues, with a market share of 28%-32% among omni-channel jewellery players. RedSeer estimates that 50%-60% of jewellery purchases in 2024 were “online influenced,” underscoring the importance of digital channels in aggregating demand and fulfilling it through hybrid models. BlueStone’s omni-channel approach integrates its website, mobile app, and stores for an immersive shopping experience, allowing customers to browse, customize, and purchase through preferred channels. Differentiators like same-day delivery and ‘Try at Home’ services enhance loyalty, with repeat revenue ratios of 44.61%, 39.83%, and 34.67% in FY 2025, FY 2024, and FY 2023, respectively. It ranks among India’s top three jewellery retailers in customer repeat rate.

In-house Technology Architecture Driving End-to-End Business Operations As of March 31, 2025, BlueStone’s in-house technology team comprised 42 members, continuously enhancing omni-channel capabilities and process automation. Its technology investments enable accurate online product visualization with multi-angle photography, size visualization, 360-degree videos, and try-at-home or video consultations. The merchandising strategy leverages AI and ML to identify design trends, particularly in studded jewellery, boosting gross margins from 31.87% in FY 2023 to 37.94% in FY 2025. Algorithms optimize store inventory based on demographics and preferences, while integration with manufacturing ensures timely replenishment. This tech-driven model has yielded industry-leading gross margin return on investment. Its PoS, OMS, PMS, and CRM systems ensure seamless front-end and back-end operations for efficient customer service.

Differentiated Approach to Product and Design BlueStone designs all its products in-house, enabling engagement with customers at different life stages and maximizing monetization. The daily jewellery segment, projected to grow at a 15%-18% CAGR to Rs 4,600–Rs 5,100 billion by 2029, is a core focus. The company maintains over 7,400 designs and 91 collections as of March 31, 2025, across 16 categories, with prices ranging from under Rs 5,000 to above Rs 1,700,000. Its average order value increased from Rs 32,038 in FY 2023 to Rs 47,671 in FY 2025. Products are certified by IGI and GIA, reinforcing trust. This consistent release of modern designs across varied price points strengthens brand appeal and supports sustained demand across diverse customer segments.

Advanced Manufacturing Capabilities with Vertically Integrated Operations BlueStone’s vertically integrated manufacturing minimizes reliance on third parties, allowing flexibility, cost efficiency, and consistency. Using CNC technology, it produces intricate designs with high precision, challenging to achieve through traditional methods. Its facilities in Mumbai, Jaipur, and Surat cover specialized processes such as diamond sorting, electroplating, and polishing. Mumbai’s gold processing capacity rose from 1,193.50 kg in FY 2023 to 1,883.25 kg in FY 2025. These advanced capabilities not only ensure quality control but also enable economies of scale and faster time-to-market for new designs, supporting the company’s ability to refresh collections frequently and maintain a competitive edge in India’s jewellery retail industry.

Pan-India Presence Across Tier-I, Tier-II, and Tier-III Cities with Healthy Unit Economics BlueStone has expanded from its first store in New Delhi in 2018 to 275 stores across 117 cities in 26 states and union territories by March 31, 2025, including 200 company-owned and 75 franchisee-operated stores, totaling over 605,000 sq. ft. of retail space. Stores are strategically located in high-visibility areas and malls, averaging 2,200 sq. ft. The brand opened 120 stores between FY 2023 and FY 2025 at ~60 per year. About 75% of stores break even within three months. Average revenue per store per month for outlets operational over three years was Rs 0.77 crore in FY 2025, Rs 0.76 crore in FY 2024, and Rs 0.56 crore in FY 2023, reflecting robust unit economics.

Peer Comparison

Key Risks & Concerns

• The company has not made any profits since it began operations. It reported losses of Rs 2,218.37 million, Rs 1,422.36 million, and Rs 1,672.44 million in FY 2025, FY 2024, and FY 2023, respectively, and had negative total equity of Rs 718.26 million in FY 2023. Continued losses or negative equity in the future could harm its operations, financial health, and the market price of its shares.
• In the past, there have been certain cases of non-compliance, including delays or lapses in secretarial and regulatory filings for corporate actions. Such non-compliance could lead to regulatory actions or penalties, which may negatively impact the company’s business, finances, and reputation.
• The company’s Repeat Revenue Ratio, representing sales from customers who have ordered more than once, was 44.61%, 39.83%, and 34.67% in FY 2025, FY 2024, and FY 2023, respectively. If it cannot effectively retain existing customers, attract new ones, or do so cost-efficiently, revenue growth and profitability could be affected. Additionally, if the Average Order Value, which was Rs 47,671.26, Rs 41,204.71, and Rs 32,038.38 in FY 2025, FY 2024, and FY 2023 respectively, declines, it may not be able to sustain its revenue levels and margins, which could significantly impact its business and performance.

Outlook and Valuation

BlueStone Jewellery has demonstrated robust growth momentum, driven by its strong omni-channel presence, expansive store network, and customer-centric digital strategy. The company’s ability to blend online discovery with offline experience has enabled it to capture a sizeable market share of 28–32% among omni-channel players in the jewellery industry in FY24. Its expanding customer base, rising average order values, and impressive store-level economics — with 75% of stores breaking even within three months — highlight the strength of its business model. Backed by in-house manufacturing facilities operating at high utilization levels and plans to open over 290 new stores by FY27, BlueStone is well-positioned to capitalize on the growing demand for premium and designer jewellery in India.

The brand’s wide product portfolio across multiple price points, supported by 91 curated collections and over 7,400 designs, appeals to a broad demographic, particularly the 25–45 age group. Repeat revenue ratio has steadily improved to 44.61% in FY25, reflecting rising customer loyalty. Strong same-store sales growth of over 30% in FY25 and geographic diversification across 117 cities further mitigate regional demand fluctuations. With over 75% of jewellery manufactured in-house, the company enjoys better quality control, faster product launches, and reduced dependency on third parties. These strengths, coupled with favourable industry tailwinds such as rising disposable incomes, urbanization, and evolving fashion preferences, position BlueStone for sustained revenue growth in the medium term.

Despite strong topline growth, BlueStone has yet to achieve profitability, posting consecutive net losses in FY23–FY25 and negative operating cash flows of Rs 665.82 crore in FY25. High inventory levels at 93.36% of revenue, exposure to gold and diamond price volatility, and potential disruption from lab-grown diamonds pose operational risks. Additionally, regulatory compliance lapses, ED summons, promoter share pledges, and delayed statutory and loan repayments raise concerns about governance and financial discipline. These factors, combined with continued cash flow pressures, create uncertainty around long-term value creation. At the upper price band, Bluestone is valued at an EV/Sales of 4.2x FY25E and EV/EBITDA of 99.8x FY25E. We recommend an AVOID rating for the issue.