Jewellery stocks tank up to 9% on PM Modi's remark

Mumbai: Shares of gold jewellery companies fell sharply on Monday after Prime Minister Narendra Modi urged citizens to refrain from buying gold for the next year to protect foreign exchange reserves, dampening investor sentiment.

Kalyan Jewellers, P N Gadgil Jewellers, PNGS Reva Diamond Jewellery, Senco Gold and Tribhovandas Bhimji Zaveri declined between 7.5% and 9.2% at the close, compared with a 1.5-1.7% fall in the Nifty and Sensex.

Analysts said the remarks could weigh on near-term sentiment, although they are unlikely to dampen demand.


"Prime Minister Modi's comments impacted investor sentiment, though FY26 revenue growth has been healthy across the sector," said Harsh Thakkar, research analyst at Samco Securities.

Thakkar said the near-term outlook for jewellery companies may remain sentimentally weak due to the government's stance on discretionary spending. Gold prices, however, remained relatively resilient, ending at ₹1,52,136 per 10 grams, down 0.3%.

Sustained moderation in gold demand would depend on policy actions, but underlying consumption trends are likely to stay intact, said Sunny Agrawal, head of research at SBI Securities.

"Jewellers have already adapted to shifting towards lower-carat offerings, which should continue to see healthy demand, particularly during the wedding season. The sector outlook for FY27 remains strong, and any dips could be good buying opportunities," said Agrawal, who prefers B2B supplier Sky Gold and Diamonds and, among retailers, Titan Company and Senco Gold. Thakkar also said long-term demand remains supported by weddings, festivals and the rising share of organised players. "Studded jewellery and premium offerings could continue to see relatively better traction," he said.