Bearish for Gold Retailers: Akshaya Tritiya Gold Demand Plummets 30%

Gold demand in India, typically robust during Akshaya Tritiya, experienced a substantial 30% decline in volume. This downturn is directly attributed to a nearly 60% year-on-year increase in gold prices, forcing consumers to either scale back purchases or opt for lighter, more affordable items.

This shift in consumer behavior is significant for the Indian market, as gold buying is deeply ingrained culturally and forms a substantial part of discretionary spending. A sustained trend of reduced volume due to high prices could impact the revenue and profitability of major jewellery retailers and gold financing companies, which rely on consistent gold demand.

Traditional jewellery retailers like Titan (TITAN) and PC Jeweller (PCJEWELLER) are likely to face negative impacts on their sales volumes and margins. Gold financing companies such as Muthoot Finance (MUTHOOTFIN) and Manappuram Finance (MANAPPURAM) could also see slower growth in their gold loan portfolios if fresh gold purchases decline, affecting their asset base.

Traders should monitor upcoming quarterly results from jewellery and gold finance companies for confirmation of this trend. Also, keep an eye on global gold price movements and any government policies related to gold imports or duties, which could further influence domestic demand and pricing.

• •Gold demand during Akshaya Tritiya dropped about 30% in volume.
• •The price of gold was up nearly 60% year-on-year, deterring large purchases.
• •Buyers stayed within budgets, shifting to lighter jewellery, small coins, and exchange-led buying.
• •Millennials preferred solitaires in the ₹75,000–2.5 lakh range.
• •Risk flag: Sudden correction in global gold prices could revive demand.