The Indian jewellery market is witnessing a major shift in consumer preferences as gold prices continue to rise sharply, crossing ₹95,000 per 10 grams on April 16, 2025. In response to this, leading jewellers like Titan and Kalyan Jewellers are revamping their strategies to keep consumer interest intact by introducing lower caratage gold pieces and focusing more on studded jewellery that contains a higher proportion of non-gold components like gemstones.

Gold Prices Reach Lifetime High

Gold, traditionally viewed as a safe-haven asset, has surged by over 30% in the past year, driven by:

• Rising fears of a global recession

• Sluggish economic growth

• Geopolitical and trade tensions

On April 16, gold touched ₹95,000 per 10 grams on the MCX, marking an all-time high. This sharp increase has led many price-sensitive consumers to reconsider their buying choices, especially those targeting 22-carat plain gold jewellery.

Shift Towards Affordable Alternatives

As buyers hesitate to stretch their budgets, jewellers are pivoting towards more affordable offerings, including:

• 18-carat and even 9-carat gold jewellery

• Studded designs that feature more gemstones and less gold

• Lightweight items with lower making charges

Titan, in its Q4 earnings call, mentioned that consumers who would previously buy jewellery around ₹50,000 have now either scaled down their purchases or exited the segment altogether.

Studded Jewellery Sees Rising Demand

One of the standout trends this quarter is the growing demand for studded jewellery, which includes a significant component of stones, making it:

• More affordable due to lower gold content

• Visually appealing to modern consumers

• Less impacted by fluctuations in gold prices

Titan and Kalyan Jewellers reported double-digit growth in this category for the quarter ending March 31, indicating a strong consumer shift.

"When it comes to studded, at least 40-45% of the material is stones. It makes sense to switch to this when gold prices are high," said Ramesh Kalyanaraman, Executive Director, Kalyan Jewellers.

Carat Composition Adjustments by Jewellers

Jewellers are carefully managing their inventory to adapt to changing market conditions. According to Kalyanaraman:

"We adjust the inventory composition between 18-carat, 22-carat, and various weight classes whenever there’s a price jump of over 30%."

This helps maintain consumer interest and ensures that jewellers can cater to a broader range of price points.

Titan Launches 9-Carat Gold via CaratLane

In a move to further reduce entry-level price points, Titan’s subsidiary, CaratLane, launched 9-carat jewellery in February. This aligns with evolving consumer preferences and helps cater to customers seeking affordability without compromising on design.

According to Ajoy Chawla, CEO of Titan’s jewellery division:

"If people have been used to buying 18-carat studded, they’re now beginning to get comfortable with 14-carat as well."

This shift indicates a growing acceptance of lower caratage jewellery, although regional preferences vary, especially in southern India, where the tradition of buying heavy, plain 22-carat jewellery remains strong.

Vacated Price Points and Competitive Challenges

Titan also pointed out that many lower price points are being vacated, meaning jewellers can no longer offer traditional 22-carat products within the ₹50,000 band due to rising costs.

While consumer demand has not dropped significantly, the types of products being purchased have changed. For example:

• Buyers are now opting for less complex designs

• Many prefer lower making charges

• Some customers are reducing the quantity of gold but maintaining overall purchase value

This strategy works well in the current economic environment, but analysts warn that volume growth could be a challenge in FY26 due to:

• Sustained high gold prices

• Rising competition among jewellers

• Changing consumer habits

Future Outlook: Challenges and Opportunities

The current strategy of reducing gold purity and focusing on design innovation is effective for now. However, experts suggest that jewellers will need to continue innovating to:

• Win over traditional buyers

• Expand into new consumer segments

• Maintain profitability amid high input costs

For instance, introducing modern designs using 14-carat or 9-carat gold, combined with lower making charges, could open doors for younger buyers and budget-conscious consumers.

On the flip side, consistent price hikes in gold could lead to:

• Declining footfall in stores

• Erosion of brand loyalty

• Difficulty in maintaining gross margins

Jewellers will need to balance tradition and trend, ensuring they retain their loyal customer base while attracting new segments through product diversification.

Conclusion

With gold prices skyrocketing and consumers turning cautious, Titan, Kalyan Jewellers, and other players in the market are embracing a strategic shift to lower caratage and studded jewellery. This helps control price points, meet customer expectations, and retain market share amid volatile macroeconomic conditions.

The success of Caratlane’s 9-carat launch, the rising share of studded pieces, and adaptive inventory management strategies highlight how the Indian jewellery industry is evolving.

While challenges persist in the form of region-specific preferences and intense competition, the industry’s flexibility and responsiveness to changing consumer behavior is likely to be the key differentiator going into FY26.

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