According to Ravi Singh, Chief Research Officer at Master Capital Services, the festive season saw strong performance from leading jewelery companies. “Interestingly, the rise in gold prices during the festive season acted as a pull factor, with consumers accelerating their purchases in anticipation of further price increases,” he says.Many buyers rushed to lock in prices before they went even higher. Jewelers also benefited from gold exchange programs, where customers take old jewelry and upgrade to new pieces, reducing cash outflows.
Motilal Oswal also said that despite steep gold inflation, consumer demand for premium brands remained resilient in Q3FY26. Same-store sales growth was strong, largely driven by higher value rather than volume. Simply put, people spent more money, but didn’t necessarily buy more grams of gold.
Also read: Risk of exchange? Small cap stocks rise to 28% in 2026, but market breadth remains weak
Are volumes decreasing now?
While sales figures for some listed jewelers looked good in the December quarter, Titan, India’s largest jeweler, has acknowledged that customer growth remained ‘muted’. Chief Financial Officer Ashok Kumar Sonthalia pointed out that revenue growth is driven more by price increases than higher volumes.
“We would like it to be balanced, where we can achieve growth in both the number of buyers and ticket prices,” he said. World Gold Council data shows that India’s gold jewelery volumes will fall 24% to 430.5 tonnes in 2025. Rising prices have put pressure on buyers on fixed budgets, forcing them to reduce the quantity they buy.
So while the revenue growth may seem impressive, investors need to understand that a lot of it is about ‘value growth’, not ‘volume growth’.
Why jewelry stocks move differently
Over the past six months, jewelry stocks’ performance has been mixed. Kalyan Jewelers is down 20% while Titan is up 20%. PN Gadgil has gained 2%, Senco Gold 11% and Thangamayil Jewelery is up 88%.
Khushi Mistry, research analyst at Bonanza, says jewelry stocks have not consistently mirrored gold’s rally. “The rise of gold often makes jewelery less affordable, which has a negative impact on volumes, although strong demand for parties and weddings may offset some of this,” she said.
Jewelry companies face business risks that gold itself does not have. They face inventory management, store expansion costs, competition, product mix challenges and margin pressure. High gold prices can also hurt margins. Motilal Oswal expects margin pressure due to an unfavorable product mix and high sales of gold coins. Coins generally have lower margins than studded jewelry.
Gold vs. Jewelry Stocks: Which is the Better Investment Right Now?
Ravi Singh believes that brand strength and formalization are key themes. “Consumer preference is steadily shifting towards organized players, leading to decline in market share of unorganized local players,” he says. This formalization trend is a strong structural tailwind for leading jewelry brands.
In other words, strong brands that consistently expand their stores, increase same-store sales and deepen customer engagement can create long-term shareholder value. However, Khushi Mistry offers a more cautious approach. She says direct exposure to gold – through bullion or gold ETFs – offers a cleaner play on price appreciation.
“Select jewelry stocks can outperform as demand, margins and fundamentals improve, but they pose more business risks than gold itself,” she says.
The prospects of gold
In the short term, the outlook for gold remains stable. Jateen Trivedi, VP Research Analyst – Commodity and Currency at LKP Securities, says gold has remained strong above key levels.
“Gold trades with gains of Rs 1,700 against Rs 1,58,500 as participants are ahead on key US data. Immediate support is seen around Rs 1,55,000 while resistance is in the Rs 1,60,000-1,62,000 zone,” he said. Volatility may increase around global data releases, but the short-term trend remains intact.
If gold continues to rise sharply, affordability concerns could increase and volume growth for jewelers could remain under pressure. For conservative investors looking to hedge against global risks, analysts say gold itself may be simpler and less risky. For growth-oriented investors willing to accept corporate volatility, select jewelry stocks with strong brands, healthy balance sheets and consistent store expansion can deliver better long-term returns.
The key is to closely monitor same-store sales growth, volume trends, margins and management commentary.
(Disclaimer: Recommendations, suggestions, views and opinions expressed by the experts are their own. These do not represent the views of Economic Times)
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