Jewellery Stocks Extend Decline as Government Raises Gold Import Duty to 15%

Shares of gold-related companies remained under pressure for the third consecutive trading session on Wednesday after the Government of India sharply increased import duties on gold and silver, triggering concerns over demand slowdown and margin pressure across the jewellery sector.

Major jewellery and gold-linked stocks including Titan Company, Kalyan Jewellers, Senco Gold, Sky Gold & Diamonds, Thangamayil Jewellery, and PC Jeweller fell up to 6% during intraday trade.

The selling pressure intensified after the government raised effective import duties on gold and silver to 15% from 6% as part of measures aimed at reducing imports, conserving foreign exchange reserves, and supporting the Indian rupee.

Government Raises Import Tariff to Protect Forex Reserves

The revised import structure includes:

• 10% basic customs duty

• 5% Agriculture Infrastructure and Development Cess (AIDC)

taking the effective import duty on precious metals to 15%.

The policy change comes amid rising global geopolitical tensions, elevated crude oil prices, pressure on India’s current account deficit, and continued weakness in the rupee.

According to market experts, the higher import duties are intended to discourage non-essential gold imports and help reduce pressure on the country’s foreign exchange reserves.

Investor sentiment in jewellery stocks weakened further after Prime Minister Narendra Modi appealed to citizens to avoid purchasing gold and gold jewellery for one year as part of broader austerity measures amid economic stress linked to the ongoing US-Iran conflict.

Gold-Related Stocks Lose Up to 15% in Two Sessions

The sector-wide correction has been sharp over the past two trading sessions.

Several jewellery counters have corrected up to 15% as investors worry that rising domestic gold prices could weaken consumer demand, particularly for discretionary jewellery purchases.

Market participants believe higher prices may affect festive demand, wedding season sales, and overall retail consumption in the near term.

Analysts also expect elevated gold prices to increase working capital requirements for jewellery retailers and potentially pressure margins if consumer demand slows significantly.

Analysts Expect Near-Term Consolidation

Technical analysts believe sentiment in gold-related stocks may remain cautious until greater clarity emerges regarding:

• Demand trends

• Gold price stability

• Consumer buying behaviour

• Impact of higher import duties

• Geopolitical developments

According to analysts at SAMCO Securities, most jewellery stocks are entering a consolidation or corrective phase following the recent sharp sell-off.

Experts suggest that while long-term structural demand for gold in India remains intact, near-term volatility may persist as investors assess the impact of policy changes on the sector.

Titan Faces Technical Resistance After Sharp Correction

Among the major jewellery stocks, Titan has witnessed significant selling pressure after correcting sharply from recent highs near ₹4,550.

Technical analysts noted that the stock has breached an important horizontal support zone around ₹4,150 on a closing basis, which is viewed as a negative near-term signal.

Analysts also highlighted a strong spike in trading volumes during the correction phase, indicating heavy distribution at higher levels.

The stock’s Supertrend indicator has reportedly turned bearish, while the 50-day moving average near ₹4,270 is now expected to act as immediate resistance during any recovery attempt.

According to technical experts, the ₹3,950–₹4,000 range has emerged as an important support zone for Titan.

Analysts believe the stock will need to reclaim levels above ₹4,400 to restore bullish momentum and improve investor confidence.

Kalyan Jewellers Approaches Critical Support Zone

Kalyan Jewellers has also witnessed sharp selling pressure after failing to sustain above key resistance levels near ₹400–₹410.

Technical analysts observed that the stock continues to form lower highs on the charts, indicating persistent selling pressure during recovery attempts.

The stock has reportedly slipped back toward March 2026 panic low levels, making the current support zone around ₹347–₹350 crucial for near-term price action.

Experts believe holding above this range could potentially create a double-bottom formation, which may support a future recovery.

However, analysts cautioned that a decisive break below ₹347 could trigger additional downside pressure in the stock.

Thangamayil Jewellery Turns Range-Bound

Shares of Thangamayil Jewellery have also weakened considerably after slipping below both the 20-day and 50-day moving averages.

Technical analysts believe the stock may now transition from a strong trending phase into a more corrective or range-bound structure.

The ₹3,500–₹3,550 range is currently seen as a major support area for the stock.

Analysts suggest that maintaining this support zone could help preserve the broader bullish structure built after previous breakouts.

However, a sustained breakdown below ₹3,500 could potentially drag the stock toward lower levels near ₹3,200–₹3,300.

Higher Gold Prices Could Impact Jewellery Demand

Industry experts believe the sharp rise in domestic gold prices following the duty hike may temporarily impact consumer sentiment toward jewellery purchases.

Higher prices are expected to affect discretionary spending categories such as:

• Gold jewellery

• Coins

• Medallions

• Luxury gifting

Price-sensitive buyers in smaller towns and rural markets may especially delay purchases in the near term until price stability improves.

However, analysts also noted that Indian consumer affinity toward gold remains structurally strong over the long term.

Long-Term Sector Outlook Remains Structurally Positive

Despite near-term concerns, analysts believe India’s jewellery sector continues to possess strong long-term growth potential supported by:

• Rising disposable incomes

• Organized retail expansion

• Premiumization trends

• Wedding and festive demand

• Shift from unorganized to branded players

Leading organized jewellery retailers are expected to benefit over the long term as consumers increasingly prefer trusted brands and transparent pricing.

However, near-term market sentiment is likely to remain sensitive to:

• Gold price movements

• Import duty changes

• Consumer demand trends

• Currency fluctuations

• Global geopolitical developments

Investors are expected to closely monitor how jewellery companies manage pricing, inventory, margins, and demand conditions over the coming quarters.