India’s Jewellery Boom May Be a Gold-Priced Mirage

India's top three jewellery retailers — Titan Company, Kalyan Jewellers, and Senco Gold — just posted spectacular October-December numbers with revenue growth between 41% and 51% year-on-year. But each of them offers a slightly different narrative.

Titan’s jewellery business grew about 41% year-on-year, thanks to festival demand and a substantial rise in average selling prices, even as buyer growth was broadly flat. Kalyan Jewellers reported roughly 42% consolidated revenue growth, with same-store sales growth of about 27%, and Senco Gold, the smaller rival with a strong footprint in East India, posted 51% growth and around 39% same-store sales growth. On a quick read, it appears that the Indian wedding wallet has become bottomless, but the backdrop has changed. Senco said gold prices rose by an average of about 65% year-on-year and peaked close to ₹140,000 per 10 grams in the quarter.

When gold moves this dramatically, revenue becomes an unreliable gauge of real demand. Much of what passes for growth is simply a higher price tag. Senco's comments place its sales spike in the context of price increases and only a slight increase in volume, suggesting that the market is not buying significantly more jewellery. Consumers are spending more on similar purchases rather than buying significantly more jewellery.

The same-store sales numbers show that the story is less straightforward than the sector’s headline growth would have us believe. Senco’s same-store sales growth of about 39% in the quarter beats Kalyan’s 27% and Titan’s low thirties across formats. That outperformance comes from a network of roughly 196 stores concentrated in East India, compared with Titan’s more than 1,100 jewellery outlets and Kalyan’s 469 showrooms across India and other countries. Senco squeezes more value out of each sale than the pan-India heavyweights. This raises questions about the ‘bigger-is-better’ narrative. If local knowledge and leaner franchise economics are driving Senco’s edge, scale on its own may not be the moat investors want to pay for.

Customer behaviour is already shifting under the strain of high prices. Titan notes that gold coin sales nearly doubled compared with last year, suggesting investment hoarding rather than celebratory jewellery. When shoppers choose coins rather than necklaces, they are hedging, not celebrating. Senco is “optimising” inventory towards lightweight and more budget-friendly ranges and explicitly leaning into 18-carat and 20-carat products as gold becomes less affordable by the gram.

Tactically, that keeps entry tickets tolerable and footfall alive. Strategically, it nudges gold away from its traditional store-of-value anchor and closer to fashion. The more one sells based on look rather than weight, the more intrinsic value is traded for brand power.

The companies are not standing still on distribution either. Titan added 47 outlets in the quarter, Kalyan opened 21 ‘Kalyan’ brand showrooms and 14 Candere stores, and Senco added four franchisees.

At a time when volumes are flat or only modestly rising, can that pace of rollout be termed “for the long term” or “reckless”? Fixed costs rise even if grams sold do not, which means return ratios become more sensitive to changes in gold prices or discretionary sentiment. International expansion, for its part, is being presented as growth, but it also works as a risk offset. Kalyan and Titan are strengthening their presence in West Asia, the US, and the UK so that if Indian households flinch at six-figure neckpiece prices, demand from the diaspora might cushion the blow.

Titan’s launch of beYon, its lab-grown diamond brand, is textbook risk management. By pitching affordable, everyday diamond jewellery for self-expression while keeping natural stones for milestone purchases, Titan is effectively building a second ladder of aspiration next to gold. The question, however, is whether normalising lab-grown products over time chips away at the symbolism and pricing power of natural diamonds, especially if more shoppers quietly trade down within the same house.

Investors need to monitor buyer growth and volume. Are more people actually buying, or are the same consumers paying more under duress? The second thing to monitor is the sales mix. Will studded and design-driven growth hold without tipping into a discount-driven volume chase, and how quickly will the shift to lighter, lower-carat products run?  Working capital and inventory discipline are also key variables to monitor. Rising gold prices inflate inventory values and can flatter balance sheets, but may mask sluggishness and rising risk if sentiment cools.

Given this context, store expansion plans, international push, and the broad-based growth narrative are a balancing act rather than a structural rerating.

In a world where gold is ₹140,000 per 10 grams, revenue growth is almost par for the course. The harder, more interesting test is whether these businesses have built resilient retail franchises and can make customers walk in rather than wait for the next exchange offer.