Sky Gold expects cash flows to turn positive by FY27, plans big capacity push

Sky Gold and Diamonds' Managing Director Mangesh Chauhan expects the company's operating cash flow to turn positive from the financial year ending in March 2027 (FY27).

The jewellery maker reported an 81% year-on-year growth in net profit in the second quarter this year. However, the company's operating cash flow has remained negative for the last five years.

"Our company is into hyper growth. We are growing by 40-50% growth. So that's why we are cash flow negative till 2027 March, and after 2027 March, we will be 100% cash flow positive company," he said.

He explained that Sky Gold has reduced its receivables cycle from 73 days in March to 65 days currently. However, receivables have risen in absolute terms alongside an increase in volumes. "We have grown volume by 20% and revenue by 30%. So our sales have gone up by 30%. That's why, in numbers, they (receivables) have increased."

The jewellery manufacturer plans on reducing the receivables cycle further by 10 days, bring it down to 50 days by FY27. The company plans on achieving this goal through its expansion into the Middle East via the recently opened Dubai office and by accelerating its advanced gold business.

These steps will help Sky Gold to reduce 100% of their receivables in the coming six to eight quarters.

Sky Gold recently acquired a company that manufactures Italian-style bangle products—an exclusive category in India and one that operates entirely on an advanced gold model. Chauhan said this allows Sky Gold to earn a high return on capital because the business does not require any upfront investment. “We are expecting a good PAT of ₹40 crore next year from this company, and ₹80 crore in the third year,” he said, adding that it will have no impact on the company’s bottom line.

Chauhan said Sky Gold now aims to capture 4–5% of India’s jewellery manufacturing market and become the country’s largest manufacturer by 2031–32. To support this goal, the company plans to open what he described as India’s largest standard facility—spanning 5,40,000 square feet—with operations expected to begin in 2028