Jewellers offer more affordable choices in 18-carat, 14-carat jewellery amid the gold price spike
Sat Mar 08 2025
Gold prices have been skyrocketing for some time now as demand has risen for the safe-haven asset amid global geopolitical and trade uncertainties that have fuelled a stock market rout this year. Prices of the yellow metal surged past the ₹88,000 per ten-gram peak in February. The price rise comes amid the wedding season, which surely would have left many shopping for jewellery unhappy and disrupted their budgets.
The wedding season is a major driver for the jewellery industry. According to Ramesh Kalyanaraman, the executive director of Kerala-based Kalyan Jewellers, almost 60 per cent of the revenue comes from weddings and related shopping.
When gold prices spike customers tend to defer their purchases. But, Kalyaraman points out that since weddings can't be postponed forever, customers eventually return and make purchases.
"What happens usually is whenever there is a sudden spike of gold price or sudden fall of the gold price, the customer takes a pause to see the direction of what is happening. There have been three spikes almost in this (January-March) quarter. Of course, the pause cannot be more than 10-15 days," he told THE WEEK.
In 2024, gold prices rose 26 per cent, making last year among the best years for the precious metal and that did have some impact on demand.
According to the World Gold Council, overall gold demand in India rose 5 per cent to 802.8 tonnes in 2024 from 761 tonnes in 2023. However, jewellery demand declined 2 per cent to 563.4 tonnes in 2024 from 575.8 tonnes in 2023.
Kalyanaraman points out that customers typically walk in with set budgets. Therefore, when prices have gone up, their volumes may come down.
Jewellers, too, have adopted their strategies to suit customer preferences. Usually, for instance, people buy 22-carat gold jewellery. Kalyan is also offering a lot of products in 18-carat gold to make it more affordable for customers.
"When you do 18-carat jewellery, there is a 15-20 per cent rate difference. That makes it more easy to buy jewellery even if the prices have gone up," said Kalyanaraman.
Similarly, in diamond jewellery, where gold is typically 18 carat, Kalyan has now introduced 14-carat gold, which also makes products a little more affordable.
Kalyan is not the only one looking at offering lightweight jewellery. Other companies have increased their offerings in the space, too, amid the rise in gold prices and also increasing demand for lightweight jewellery from customers.
"We are also observing a shift in consumer preferences with a growing inclination towards lightweight, rose gold, and white gold, primarily among younger customers. We also anticipate that by 2029, the demand for 18-carat gold will increase significantly, bringing further opportunities for growth in the industry," said Saurabh Gadgil, the chairman and managing director of PN Gadgil Jewellers, in the company's latest post-earnings call with investors.
Kalyan currently has around 270 showrooms. It plans to open another 170 showrooms in the upcoming financial year ending March 2026. Of these new showrooms, 90 showrooms will be under the Kalyan brand, while the remaining will be under its lifestyle jewellery brand Candere.
Kalyan Jewellers completed the buyout of Enovate Lifestyles, which operates under the Candere brand, in 2024. The company is transitioning the brand from online only to an omnichannel brand, through which it sells lightweight jewellery.
"Candere is in a transformation phase. It was a 100 per cent digital company. The focus was completely online. From last year, we have started offline also. In the next financial year, we will start brand campaigns and store expansion will also happen," said Kalyanaraman.
The company has set a ₹1,000 crore revenue target for Candere over the next 2-3 years.
Kalyan Jewellers is also expanding more in markets outside of the southern states as it scales up its pan-India presence. Out of the 90 showrooms that it will open under the Kalyan brand, 75 will be in non-south markets, while 15 will be in south India and international markets. The company's international showrooms are spread across the US, the UK and the Middle East.
Source: https://www.theweek.in/