Kalyan Jewellers to Expand via Franchise Route, Focuses on Debt Reduction

Kalyan Jewellers has announced an ambitious plan to scale up its operations through a franchise-led model aimed at reducing its overall debt burden. The company intends to open 170 new franchise outlets in FY26, including 90 under its flagship Kalyan brand and 80 for its lifestyle jewellery vertical, Candere. This expansion strategy spans across India and international markets such as the United States, United Kingdom, and the Middle East.

As of June 30, 2025, the company operated 406 showrooms, including 287 Kalyan outlets across India, 36 in the Middle East, two in the US, and 81 Candere stores. The upcoming expansion will primarily target non-Southern states, with a focus on Tier-I to Tier-IV cities, while overseas growth will be more gradual. Seven international showrooms are planned this year, and Candere’s global footprint is expected to grow from FY28 onward.

Kalyan’s asset-light franchise model is designed to minimize capital expenditure, allowing the company to channel surplus cash toward debt repayment. The jeweller plans to reduce its Gold Metal Loan (GML) liability by ₹300 crore this fiscal, following a ₹400 crore reduction achieved in the previous year. It is also working to bring down its non-GML debt to ₹600 crore by monetizing certain land holdings mortgaged for working capital.

Currently, 40% of Kalyan’s revenue is generated through franchise outlets. The company anticipates achieving a 50:50 revenue split between franchise and company-owned stores by the end of FY26. This shift is expected to boost return on capital employed and improve margins.

To support its expansion, Kalyan is establishing a dedicated manufacturing hub in Thrissur, consolidating over 1,000 contract manufacturers. The company remains optimistic about market conditions, driven by steady same-store sales growth and positive monsoon prospects, and sees this franchise-driven model as key to its long-term financial stability and growth.