Choice Institutional Equities has reiterated its 'Buy' rating on Shringar House of Mangalsutra with a target price of ₹400. The update follows strong Q2 FY27 results, where the company saw significant revenue and profit growth driven by a strategic shift toward corporate clients and the expansion of its bridal jewellery division.
Shringar House of Mangalsutra received a reiterated 'Buy' rating from Choice Institutional Equities, which raised its target price for the stock to ₹400 per share. The brokerage update follows the company's strong performance in the second quarter of the 2027 fiscal year, where it reported a 54.8% year-over-year revenue increase to ₹818.7 crore. Net profit for the period climbed 73.2% to ₹39.5 crore, reflecting growth in core operations.
The brokerage attributed this performance to a significant structural shift in the company's business model. Corporate customers now account for 51% of total revenue, a change that has helped improve cash flow stability through more consistent repeat orders. Additionally, the company is seeing early traction in its recently launched bridal jewellery segment, which captured approximately 10% of manufacturing volume within its first six months. The firm also recently received board approval to incorporate a wholly-owned subsidiary for jewellery manufacturing and trading, with an initial planned investment of ₹5 crore.
Despite the growth, the brokerage highlighted important financial factors that investors should monitor. While revenue and profit have risen, the company faces pressure on its profit margins due to rising employee and overhead expenses. Management is currently working to balance this growth with cost controls.
Another key area for shareholders to track is the company's working capital management. As the business scales, it has required increased working capital, which is reflected in rising trade receivables and inventory levels. Efficiently managing these cash conversion cycles is essential for sustaining long-term financial health. Furthermore, investors may note that despite consistent profit growth, the company has remained inactive on the dividend front. Future updates on how the new subsidiary contributes to revenue and whether the company can stabilize its profit margins amid rising operational costs will be important for market observers.