India's gold market is experiencing a dramatic surge, with MCX gold prices rallying 13.3% since July 31, reaching a record high of ₹1,62,438 per 10 grams on August 21. According to the World Gold Council, India's upcoming festive and wedding season is beginning to provide additional support to gold demand, with jewelry buying picking up as consumers return to the market. This recovery follows a period of subdued activity, with dealers reporting increased footfall in jewelry stores and a rise in inquiries, signaling a shift from the cautious approach seen earlier in the year. The surge is being driven by stable gold prices and the onset of the traditional wedding and festival season, creating renewed consumer demand and higher jewelry-store footfall. Currently, gold is trading at around ₹1,63,079 per 10 gms on MCX, up by 0.15% from its previous close, though higher prices can weigh on consumer demand as they make jewelry more expensive.
Major Indian jewellery retailers are increasingly offering customers cash for their old gold as high prices and volatile demand put pressure on sales and margins ahead of the festive season. According to reports from Mint, large listed jewellers including Kalyan Jewellers India Ltd and Titan Co. have introduced or expanded cash-for-gold programmes since June, taking a service that was traditionally associated with smaller and regional jewellers into the organised market. Kerala-based Joyalukas, which operates over 200 stores, also offers cash for gold under these schemes. The cash-for-gold strategy is showing significant results, with Kalyan Jewellers' executive director Ramesh Kalyanaraman revealing during an analyst call that the share of cash-for-gold to the company's business rose to double digits from single digits in the June quarter. In the international market, spot gold price eased modestly 0.3% to $4,642.74 per ounce on Aug. 26 after peaking on Tuesday, since mid-May.
The cash-for-gold strategy is showing significant results for some retailers. As reported by Mint, Kalyan Jewellers' executive director Ramesh Kalyanaraman revealed during an analyst call on 4 August that the share of cash-for-gold to the company's business rose to double digits from single digits in the June quarter. The company expects the business to be margin-accretive because it buys the recycled gold at a discount to the prevailing spot price. Kalyan's India business saw the share of recycled gold rise to 46% in the June quarter from 31% in the March quarter. The financial impact extends beyond individual retailers, with central banks buying 289 tonnes of gold in Q2 2026, the highest quarterly purchase on record, providing structural support for gold prices.
Senco Gold and Diamonds is targeting over 25% revenue growth to ₹10,500-11,000 crore this financial year, building on its ₹8,430 crore revenue in FY26. According to Managing Director Suvankar Sen, the company plans to launch approximately 20 new stores by 2026-27, including both franchise and company-owned locations in tier II and III areas. The expansion strategy involves 12-13 franchise stores and 6-7 company-owned stores, with the franchise model expected to reduce capital expenditure to around ₹200-250 crore in FY27. Sen emphasized the company's focus on 60-70% revenue from eastern regions where it has built consumer trust, while targeting expansion in northern markets which currently contribute around 10% of revenue.
Recent trends in the jewellery market indicate that demand for jewellery is recovering after a softer period, primarily driven by relatively stable gold prices and retailers building inventory ahead of the festive season. However, buyers have increasingly shifted towards lighter-weight and lower-carat jewellery to manage higher prices, while exchange schemes, savings plans and flexible payment options are helping support purchases. Investors will be closely watching whether improving consumer demand can translate into stronger sales and earnings growth. The festive and wedding season outlook remains positive with weddings contributing to 60% of gold purchases in India, though some retailers like Titan are experiencing limited traction in their cash-for-gold programs despite the sector-wide recovery.
