Less than a year and a half after its IPO, the jeweler delivered disappointing preliminary results that show its profit plunged nearly 60% last year
image credit: Bamboo Works
Key Takeaways:
- Mokingran Jewellry’s revenue rose last year, but its profit tumbled nearly 60%
- The jewelry retailer’s massive loss stemmed from its gold-price hedging strategies during the period
A bull run in the global gold market has pushed the precious metal to successive new highs, boosting just about everyone along the food chain, from miners to jewelry sellers. Yet retailer Mokingran Jewellery Group Ltd. (2585.HK) bucked that trend on Feb. 27 by warning of a major profit decline last year, setting the stage for an anticlimactic annual earnings report set for release later this month.
Mokingran said it expects to report revenue between 19.7 billion yuan ($2.85 billion) and 22.77 billion yuan for 2025, representing flat to year-on-year growth of up to 16%. But its profit moved decidedly downward, plummeting 50% to 59% to between 77 million yuan and 94 million yuan last year.
While gold has climbed with barely a pause, repeatedly shattering new records, Mokingran has yet to profit from the gains. Its profits have dropped steadily since its late-2024 listing, including a 17.8% slump in 2024 to 189 million yuan. It fell into the red with a loss of 70 million yuan in the first half of 2025, which is now dragging on its full-year profit.
What’s plaguing Mokingran?
The root issue for Mokingran lies in its Au(T+D) deferred delivery contracts and its gold loan agreements. The company anticipates a loss of 898 million yuan to 1.1 billion yuan on such financial instruments in 2025, up as much as 75% from the previous year.
Au(T+D) contracts, offered by the Shanghai Gold Exchange, are “spot deferred settlement” instruments allowing leveraged long or short positions, blending features of spot and futures trading. Gold loans involve borrowing physical gold from banks and other platforms, and repaying it later with interest when the loan comes due.
Traditionally, Mokingran utilized gold …