Gold price surge to drive jewellery sector revenue growth despite volume decline

The Indian jewellery sector is expected to log revenue growth of 21-23% in the fiscal year ending March 2027, riding on gold prices anticipated to surge 25-27%, according to credit rating agency CRISIL. However, the expansion in rupee terms masks an underlying weakness in physical demand, with unit sales volumes projected to decline as higher precious metal costs price out budget-conscious buyers. The divergence between revenue and volume growth reflects the sector's heavy reliance on commodity pricing rather than consumption expansion. Consumer affordability concerns are likely to weigh on purchasing patterns, particularly in smaller towns and rural markets where price sensitivity remains acute. The projected correction in volumes underscores the challenges facing jewellery retailers and manufacturers who must navigate higher input costs while managing customer acquisition in a price-conscious environment.