Jewellers in FY25: Shift to Lightweight, Lower-Carat Jewellery & Tier-2 Expansion
As gold hit ₹1L per 10g, jewellers moved to lightweight, lower-carat designs, studded jewellery growth, aggressive Tier-2 expansion, & disciplined capital strategies
1. Introduction: FY25 Changed the Game for India’s Jewellery Industry
Gold breached ₹1 lakh/10g for the first time — stretching budgets, pressuring volume.
Weddings remained resilient — seasonal demand drove footfall across regions.
Buyers evolved — higher old gold exchange, shift to 18k/14k jewellery, and lighter designs.
Studded jewellery grew in entry price points — while solitaires faced demand caution.
Organised players expanded deep into Tier 2–4 markets using asset-light franchise models.
Inventory surged — not due to stockpiling, but sharp rise in gold prices.
Margins held — driven by hedging, leverage, and working capital control.
Shift underway: from weight to design, from purity to brand.
Bottom line: FY25 was a mindset shift, not just a market shift.
2. FY25 Strategy Snapshot: How India’s Top Jewellers Stack Up
Titan leads in premium positioning, product innovation, and balance sheet discipline.
Kalyan is the most aggressive scaler via FOCO and new geographies.
Senco is methodically building studded and franchise momentum while preserving margins.
DP Abhushan is in early growth mode with focus on wedding and regional dominance.
Thangamayil remains conservative, especially on new formats and product mixes.
3. Macroeconomic Context
Gold soared to all-time highs (from ~₹6,300 to ₹1,00,000/10g) amid:
Central bank buying
Geopolitical risk hedging
Global economic uncertainty
Weddings remained a macro driver:
~1 crore weddings in India supported demand
Bridal budgets proved more resilient than discretionary gold spending
Rising urbanisation and income in Tier 2–4 towns:
Organised players chased aspirational demand beyond metros
Inflation manageable, but gold price hikes sharply visible
High-ticket discretionary purchases (e.g. solitaires) took a hit
Sub-₹1L purchases (e.g. gifting, daily wear) remained steady
GML (Gold Metal Loan) costs rose to 6.6% in Q4 due to global disruptions
Firms used hedging and franchise-led growth to maintain working capital discipline
4. Demand Trends & Consumer Behavior
Weddings drove topline across brands
Kalyan, Senco, DP Abhushan leaned heavily on bridal collections
Volumes declined, ticket sizes rose
Titan: low growth in sub-₹50k buyers
Senco: 3–4% drop in gold volumes
Kalyan: wedding demand stable, discretionary demand soft
Old gold exchange surged:
Senco: 40% of sales from exchange (vs. 25% two years ago)
DP Abhushan saw strong traction in Rajasthan/MP
Shift in caratage and design
Rise in 18k/14k usage (especially in studded and fashion jewellery)
Titan, CaratLane, Senco exploring 9k diamond offerings
Mixed momentum in studded jewellery
Titan: small-stone pieces rising; solitaires cautious
Senco: +38% value, +21% volume in Q4
Buyer mindset evolving:
Repeat buyers growing share
Exchanges leading to upgrades
Gen Z prefers style, not weight
5. The Diamond Shift
Entry-level diamond pieces booming
Titan, CaratLane, Senco seeing strong under-₹1L studded traction
Solitaires sluggish:
Price volatility + investment doubts hurting demand
Titan reports buyer hesitation
LGDs (Lab-Grown Diamonds): potential disruptor
Prices falling sharply; still not widely adopted by majors
Titan & Senco remain cautious, focus on natural diamonds
Studded exchange behaviour:
Most customers upgrade — not downgrade to gold
No major distress selling trend seen
Brand strategy shift:
More 14k/9k launches to lower entry barriers
Campaigns reframing studded as style, not just sparkle
6. Geographic and Channel Expansion
Tier 2/3/4 cities = top expansion priority
Kalyan, Senco, DP Abhushan entered 20+ new small-town markets
Store count surging:
Kalyan: 137 stores added in FY25; 170 planned for FY26
Senco: 16 stores in FY25; 18–20 more targeted
Titan: 40–50 new stores + 50–60 store upgrades planned
FOCO (franchise-owned, company-operated) growing fast
Kalyan, Senco scaling via asset-light models
Thangamayil staying conservative
Omni-channel focus deepening:
CaratLane, Candere, Everlite blending online + offline
Personalised discovery tools, digital marketing, remote shopping options growing
International bets small but rising
Kalyan entered US
Titan prepping for UK
7. Capital Efficiency and Inventory Management
Working capital ballooned due to gold inflation
Inventory value rose despite flat volume
Senco: inventory days up from 151 → 166
GML use widespread but volatile
Rates peaked at 6.6%; now normalising near 5–5.5%
Titan has edge in pricing, hedging
Inventory strategies evolved
Hyperlocal assortments
Faster design churn, especially studded
Seasonal readiness (Akshaya Tritiya, Diwali)
Capital allocation priorities:
Kalyan cutting debt (target: ₹400 Cr in FY26)
Senco holding D/E flat at ~1.0x
Titan targeting long-term ROCE/ROE improvement
Hedging essential
Titan and Senco leveraged forward contracts for margin protection
60–80% hedge ratio typical
8. Competitive Landscape and Pricing
Making charge competition heating up
Regional players offering deeper discounts
Organised brands holding price line, leveraging trust + service
Differentiation via design
Titan: localised collections
Senco: 25k+ new designs; fashion-first lines (Everlite, Berry)
Brand equity matters
Lifetime exchange, purity assurance, buying experience = key to consumer stickiness
Sales teams + incentives driving upsell
Staff bonuses aligned to studded conversion
Regional brands still present
But unorganised losing share in metros + large Tier 2 towns
9. FY26 Outlook
Revenue growth expectations
Titan, Kalyan, Senco: 18–20%+ top-line
Margin outlook:
Titan: steady at ~11.5%
Kalyan: aiming for >5% PBT
Senco: 6.8–7.2% EBITDA; 3.5–3.7% PAT
Expansion targets:
Kalyan: 170 stores
Senco: 18–20 stores
Titan: 40–50 new + 50–60 upgrades
Studded focus continues
Titan, Senco targeting studded ratio improvement
Capital discipline
Inventory control, franchise scaling, cost management top priorities
Risks to watch:
Gold volatility, GML rate swings
Rural softness or weak monsoon
Solitaires + LGD overhang on diamond margins
10. Structural Growth Drivers
Organised share rising fast
Driven by GST, hallmarking, digital payments
Weddings offer non-cyclical base
8–10 million weddings annually = stable demand floor
Gen Z changing jewellery perception
From dowry to design
From weight to identity
Format innovation expanding access
Shop-in-shops, small-format outlets, gifting collections
Omnichannel = default playbook
Online aids discovery; offline anchors trust
Jewellery is both emotion + asset
Still valued for resale and legacy
11. Risks and Uncertainties
Gold price swings
Delays purchases, impacts margins, strains inventory
Margin headwinds
Higher GML rates, promotional pricing pressure, franchise dilution
Demand volatility
Monsoon, elections, global macro can hit discretionary spends
Diamond drag
Solitaires weak
LGD disruption unclear
Regulatory shifts
GST hike or hallmarking reforms could hit industry
Digital disruption
D2C brands, social-first discovery eating into legacy marketing
12. Conclusion
FY25 forced evolution across the board
High prices tested demand
Brands leaned into insight, not just inventory
Mindset > Metal
Winning players adapted to what consumers want, not what they used to sell
Structural tailwinds remain intact
Weddings, Tier 2 wealth, Gen Z style, digital discovery
FY26 watchlist:
Can solitaires rebound?
Will LGDs gain trust?
Will margins hold if gold stays volatile?
Final word:
Jewellery is no longer just a product. It’s a platform for identity, trust, and growth.
The brands that treat it that way will lead the next decade.
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