Jewellers’ strong Q2 growth masks a continued drop in gold volumes

The trend is expected to continue through the current fiscal year. Crisil Ratings expects revenue of organised jewellery retailers to grow 21-23% in FY27, even as sales volumes decline 4-6%. Gold prices are expected to average 25-27% higher than the previous fiscal year, supporting revenue growth despite weaker demand by volume. The price of 24K gold fell from ₹1,63,437 per 10 grams on 24 August to ₹1,38,192 on 12 November.

That pullback was driven by hotter US inflation and strong jobs data, which fueled expectations that the Federal Reserve would hold or raise interest rates. Higher Treasury yields and a stronger dollar made non-yielding bullion less attractive compared with interest-bearing assets, while profit-booking, exchange-traded fund (ETF) outflows and broader equity-market selling added to the pressure.

Titan Co. Ltd reported 24% year-on-year growth in its jewellery business to ₹17,495 crore in Q2FY27, excluding bullion and digital gold. Kalyan Jewellers Ltd reported a 32% increase in consolidated revenue to ₹10,323 crore. Kalyan reported same-store sales growth of about 20% in the quarter, while Titan did not disclose same-store sales growth.

“We have seen fantastic growth at a consolidated level across most of our brands and businesses... driven, of course, by a lot of focus on innovation and prioritizing growth over everything else, given the opportunity that India offers,” Ajoy Chawla, managing director of Titan, said on 5 November.

The company also sees gold exchange as an important tool to sustain purchases. “One is the whole gold exchange programme, which is a huge lever, and as you are aware, we have been at it for the last one year, and that is something that is giving us good results,” Arun Narayan, chief executive of Titan's jewellery division, said on 5 November. Narayan said the retailer's role was to offer customers a choice. “It is a long-term strategic decision we have taken, and we would like to stick with it,” he added.

Kalyan Jewellers, meanwhile, is using cash-for-gold programmes alongside traditional exchange to protect margins. Ramesh Kalyanaraman, executive director of the company, said gold-for-cash transactions accounted for 7-8% of the business, taking the overall exchange share to 42%. This helped keep margins stable in Q2, he said on 11 November.

“Every quarter, we are seeing that there's a drastic change in the karatage shift from 22-karat to 18-karat to 14-karat and 9-karat. So, 100% there is a shift... youngsters want to buy lower karatage at a very decent budget,” Mangesh Chauhan, managing director of Sky Gold, said on 31 October.

BlueStone is expanding its range across price points as it seeks to widen its customer base. “A million customers teach you things no survey ever can, and we closely watch what they want on our own platform. The clearest lesson is that today's customer wants to feel elegant and aspirational, and wants her jewellery to do that for her,” Gaurav Singh Kushwaha, founder and chief executive of BlueStone, said on 23 October.

“The second lesson is that aspiration in India no longer has a pin code. We know where our customers are before we decide where to open,” he said. All seven cities BlueStone entered during the quarter were in tier-II and tier-III markets.

Margin pressures ahead

While higher gold prices are supporting revenue growth, retailers could face pressure on operating margins as inventory gains taper and spending on promotions and customer engagement increases. Crisil expects operating margins of organised jewellery retailers to decline by 60-80 basis points to 8.5-8.7% in FY27, from 9.3% in the previous fiscal year.

Higher inventory values will necessitate additional working-capital borrowings even as retailers continue investing in network expansion and product diversification, according to Crisil. "While elevated gold prices will increase inventory funding requirements, the sector's credit fundamentals remain well supported by healthy cash accruals, prudent inventory management, and measured growth strategies,” said Nishita Vora, team leader, Crisil Ratings.

Vaeshnavi Kasthuril

Vaeshnavi reports on the business of consumption from Bengaluru, tracking how India shops, eats, and clicks. As a correspondent with Mint’s consumer economy team, she covers sectors ranging from retail and food and beverage to the rapid rise of quick commerce. She is a 2025 graduate of the Asian College of Journalism’s Bloomberg Business and Finance programme. She joined the Mint newsroom in May 2025 and this is her first stint in journalism. She holds a bachelor's degree in accounting and finance from the University of Madras. Vaeshnavi loves storytelling and breaking down complex jargon and numbers to bring out insightful yet simple-to-understand narratives. She is a Malayali but has spent most of her life living in Chennai. During her school days, she was an avid debater and loved participating in anything that involved holding a mic and standing on stage talking to a room filled with people. A diehard SRK fan, she can be found vibing to Indie music and Bollywood songs in her free time. She is a self-confessed cold coffee addict who won’t let a day pass without one, and is always café-hopping in search of the city’s best brew.

Neethi Lisa Rojan

Neethi Lisa Rojan is a senior correspondent focusing on the consumer goods and retail sector working from Mumbai for Mint since 2026. She has been a journalist for a little over two years with Moneycontrol and The Morning Context. She has covered the consumer and healthcare sectors in earlier roles. She was a double gold medallist during her bachelor’s from Mahatma Gandhi University Kerala and post-graduation from Pondicherry University. With a background in commerce and journalism, she brings a sharp analytical lens to stories on India’s fast-evolving consumer goods and retail sector.With an academic background in business administration and a keen eye for financial statement analysis, she bridges the gap between corporate data and compelling narrative journalism. Her reporting is characterized by a focus on how evolving consumer behaviours and regulatory changes impact India's largest mass-market brands. She is a keen learner with diplomas in international business, human rights and journalism. She specialized in business journalism at the Asian College of Journalism, Chennai. When she is not looking into shopping carts, you can find her explaining the latest conspiracy theory.