Jewellery Stocks Rebound After Modi's Comments: Strategies for Traders Following the Correction

Gold Prices Weigh on Indian Jewellery Stocks

In Monday's trade on May 11, jewellery stocks such as Kalyan Jewellers India, Titan Company, and Senco Gold witnessed heavy selling, falling up to 10% after Prime Minister Narendra Modi urged citizens to avoid non-essential gold purchases for a year in order to help protect the country's foreign exchange reserves.

Modi's remarks on gold, made on Sunday, were part of a broader set of austerity measures that included reducing fuel consumption, avoiding foreign travel for a year, adopting Swadeshi products, cutting down on cooking oil usage, shifting towards natural farming, and curbing discretionary gold purchases. Indian households remain among the world's largest consumers of gold.

According to Commerce Ministry data, gold imports surged 24% to an all-time high of USD 71.98 billion in FY26, compared to USD 58 billion in FY25. However, in volume terms, gold imports declined 4.76% to 721.03 tonnes from 757.09 tonnes in FY25. Despite lower import volumes, elevated gold prices pushed import values to record highs, raising concerns over the widening current account deficit.

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Analysts See Short-Term Pressure, but Remain Positive on Quality Jewellery Stocks Ajit Mishra of Religare Broking believes short-term volatility in jewellery stocks could continue amid the current geopolitical uncertainty, but long-term investors should remain invested in fundamentally strong companies. Mishra notes that Titan Company has delivered despite gold prices being at the higher end, and that earnings were good, especially in terms of performance.

Harshal Dasani, Business Head at INVasset PMS, suggests that investors should approach jewellery stocks with caution and focus on quality names during corrections rather than reacting emotionally to the recent selloff. Dasani believes that the reaction currently appears more sentiment-driven than a reflection of a structural slowdown in the sector.

Dasani added that the sustainability of the weakness would depend on whether consumer behaviour actually changes over the next two to three quarters. He pointed out that jewellery demand in India has historically remained resilient due to its strong connection with weddings, festivals, and household savings behaviour. According to him, organised jewellery players could continue gaining market share from smaller unorganised jewellers despite near-term volatility.

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From an investment perspective, Dasani believes Titan remains the highest-quality play due to its strong brand, premium positioning, and diversified retail portfolio, while Kalyan Jewellers offers higher growth potential but with relatively higher volatility. He advised investors to avoid aggressively buying smaller jewellery stocks until sentiment stabilises and instead adopt a staggered accumulation strategy during deeper corrections.