New Delhi: India’s organised jewellery sector is expected to maintain healthy growth momentum in the near term, supported by robust wedding and festive demand, even as gold prices have surged more than 80 per cent year-on-year, according to a report by Nuvama Research.
The report noted that jewellery demand remained resilient during the fourth quarter of FY26 despite record-high gold prices, with leading retailers reporting strong revenue growth and improved customer traction.
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“Driven by weddings and festivals, jewellery demand has maintained a steady momentum in Q4FY26 despite an 80%+ surge in gold prices,” said Nuvama Research.
The brokerage expects demand trends to continue into the first quarter of FY27, although it cautioned that the Adhik Maas period and the government’s recent increase in gold import duty from 6 per cent to 15 per cent may create some short-term headwinds.
“Companies expect this trend to persist into Q1FY27, though they remain cautious due to the Adhik Maas period (16th May-15th June) and a recent custom duty hike from 6% to 15%, which may temporarily soften near term demand,” the report added.
According to the report, consumer demand has remained strong due to the cultural significance of gold purchases during weddings and major festivals such as Gudi Padwa, Poila Boishakh and Akshaya Tritiya.
“Despite a massive 80% surge in gold prices, demand remained robust, driven heavily by wedding seasonality and key festivals,” Nuvama stated.
The report highlighted evolving consumer behaviour as buyers adapt to elevated gold prices. Customers are increasingly opting for lightweight jewellery and lower-carat products to manage budgets.
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“Consumers are shifting toward lightweight designs and lower caratage options (such as 9k, 14k and 18k gold),” the report said.
Another emerging trend has been a rise in investment-led purchases. The report noted that higher gold prices have encouraged customers to buy gold bars and coins as investment assets.
“There was a temporary but significant consumer shift from consumption to investment-led buying,” Nuvama observed,
The report also pointed to a sharp increase in old-gold exchange transactions as consumers seek to offset the impact of higher prices and duties.
“As gold prices soared, companies aggressively promoted old-gold exchanges,” it said, noting that exchange volumes accounted for nearly half of revenues for some retailers.
Organised jewellery players continue to pursue aggressive store expansion to deepen market penetration, particularly in Tier-II, Tier-III and Tier-IV cities. Expansion remains a “core growth pillar” for the industry, according to the report.
On the outlook, Nuvama said growth momentum has continued in the early part of FY27, supported by elevated gold prices and strong wedding and festive demand. However, the brokerage warned that the recent import duty hike could impact volumes in the short term.
“Our sense is that volume should decline by 0.3-0.5% for every 1% increase in price; hence a 9% increase in custom duty plus cess should impact volumes by 3-5% for the next one-two quarters,” the report said.
Despite these challenges, the report remains positive on the sector, citing resilient consumer demand, rising organised market share, expansion of retail networks and increasing adoption of gold recycling programmes across major jewellery retailers.
