Bluestone IPO Reduction in Size Amid Increased Losses

Bluestone, a vertically integrated jewellery brand, has announced a reduction in the size of its IPO according to its Red Herring Prospectus (RHP). This decision comes at a time when the company is facing a 56% year-on-year rise in losses that outstripped revenue growth in the last fiscal year (FY25).

Financial Performance Overview

Bluestone’s revenue from operations saw a remarkable increase of 40% year-on-year, reaching Rs 1,770 crore in the fiscal year ending March 2025, compared to Rs 1,266 crore in FY24, based on the restated financial statement provided in the RHP.

Revenue Streams

The company’s primary revenue source comes from the sale of jewellery, including diamonds, gold, platinum, gemstones, and pearls, with an average order value (AOV) of Rs 47,671 in FY25. This growth trajectory was attributed to enhanced store maturity and a diversified product portfolio. Based in Bengaluru, the company operated a total of 275 stores across 117 cities in 26 states and union territories by March 2025.

Sales Channels

Online sales accounted for merely 6.66% of total sales, indicating that the majority of income was derived from physical stores and other channels.

Expense Analysis

On the expense side, Bluestone’s cost of materials was the largest expenditure, rising by 46% to reach Rs 1,098 crore, which represented 54% of total expenses. Employee benefit expenses increased by 47% to Rs 203 crore, while advertising costs rose by 28% to Rs 159 crore compared to FY24. Additional operational and finance expenses accounted for Rs 643 crore, tabulating total expenses to rise by 42% to Rs 2,050 crore in FY25, up from Rs 1,446 crore in FY24.

Net Loss and EBITDA

As Bluestone’s expenses escalated at a quicker pace than its revenue growth, its net loss widened by 56% to Rs 222 crore in FY25, up from Rs 142 crore in FY24. Nevertheless, the company managed to achieve a positive EBITDA of Rs 133 crore, with an EBITDA margin of 7.27% in the last fiscal year.

Operational Efficiency

On a per-unit basis, the company incurred costs of Rs 1.16 to earn every rupee of operating revenue in FY25. By March 2025, Bluestone’s current assets stood at Rs 2,130 crore, inclusive of Rs 187 crore in cash and bank balances.

Strategic Investments

In FY25, Bluestone pursued two strategic investments. The company acquired a controlling interest in Ethereal House Private Limited (EHPL) for Rs 17 crore and subscribed to shares in Redefine Fashion Private Limited for Rs 11 crore. Notably, EHPL was devoid of operations or significant assets; thus, this acquisition was categorised solely as a corporate control transaction without goodwill or asset revaluation. As a result, all figures from FY25 are consolidated, while FY24 figures reflect the standalone balance sheet.