Should You Invest in Jewellery Stocks as Gold Prices Surge?
Gold prices have risen by more than 35% this year, making 2025 a remarkable year for the yellow metal. With gold reaching all-time highs, it has increasingly become a safe-haven investment option for the common man. The rise in gold prices, the beginning of the festive season, and GST 2.0 reforms have also shifted investor attention towards jewellery stocks.
On September 11, shares of major jewellery companies such as Titan, Kalyan Jewellers, Senco Gold, and PN Gadgil Jewellers recorded a marginal decline of 0.25% to 1%. Despite this weak trading session, market experts remain optimistic about the sector. Analysts highlight that while the gemstone and jewellery industry has not received direct tax relief, reforms under GST 2.0 are likely to boost disposable incomes, indirectly increasing jewellery demand during the festive season.
According to market views, if the current spike in gold prices is short-term, it could benefit jewellery manufacturers by increasing their surplus reserves, potentially lifting stock performance. Furthermore, the revision in GST structures is expected to improve cash flows and enhance consumer sentiment, encouraging jewellery purchases.
Experts point out that as some investors move away from physical gold and towards equities, top jewellery stocks have delivered healthy returns. However, they also caution that challenges such as global price volatility and narrow profit margins remain. The future growth of jewellery companies will depend on strategic business moves and consumer demand trends.
Bottom Line
While the jewellery sector shows promising potential during the festive period, investors are advised to evaluate fundamentals and market trends before making decisions.
Disclaimer: This article is for informational purposes only. It does not constitute investment advice. Readers are encouraged to consult a certified financial advisor before making any investment decisions.
