Shares of Indian jewellery companies witnessed significant gains after the release of December-quarter sales results, fueled by strong festive-season demand, despite soaring gold prices. Titan Company emerged as a standout performer, hitting a record high as the sector demonstrated resilience and robust growth.

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Titan Company Leads the Rally

Shares of Titan Company (TITN.NS) surged 4.8%, reaching an all-time high of ₹4,307.80, following a report of a 40% jump in quarterly sales. Analysts attribute this growth to strong consumer engagement during the festive season and the company’s strategic gold exchange offer, which encouraged continued purchases despite rising gold rates.

According to CLSA, Titan’s sales growth in the third quarter was impressive, particularly in the context of record-high gold prices. While some experts like Nomura warn that such promotions could slightly affect profit margins, the overall market response remained positive, making Titan the top gainer on the Nifty 50 index (.NSEI).

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Other Jewellery Retailers See Substantial Gains

Other Indian jewellery stocks also performed well:

• Kalyan Jewellers (KALN.NS) rose 3.7%
• Senco Gold (SENC.NS) jumped 12.2%
• PC Jewellers (PCJE.NS) gained 5.2%
• Thangamayil Jewellery (THNG.NS) climbed 7.1%
• Tribhovandas Bhimji Zaveri (TBZL.NS) surged 10.5%

The sector’s resilience is largely attributed to strong festive-quarter sales, as consumer spending remained high even with gold prices up nearly 12% during the quarter, marking the precious metal’s steepest annual rise since 1979.

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Gold Prices Surge Amid Geopolitical Tensions and Policy Changes

Spot gold prices experienced significant growth in the December quarter, driven by factors including:

• Geopolitical uncertainties
• Central bank purchases
• Interest rate cuts

Despite higher gold prices impacting volumes, total consumer spending continued to rise. Dharmesh Kant, Head of Equity Research at Cholamandalam Securities, stated, “Higher prices did have an impact on volumes, but not on overall spending.”

He also highlighted the role of favorable fiscal policies, such as GST cuts and income tax relief, which increased disposable income, along with low inflation, supporting higher consumer purchases.

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Positive Outlook for Wedding and Festive Seasons

Analysts remain optimistic about the jewellery sector, citing strong demand for upcoming wedding seasons and continued festive sales. The combination of innovative marketing strategies, such as gold buyback or exchange offers, and rising consumer confidence has kept the sector on a solid growth path.

As the Indian jewellery market continues to expand, stocks like Titan, Kalyan Jewellers, and Senco Gold are likely to remain attractive for investors seeking exposure to retail jewellery and gold demand trends.