Indian jewelry retail sector grows by $30 billion in 6 years: report

New Delhi:

India’s jewelry retail sector has grown to $80 billion (Rs 666,480 crore) in FY2024 from $50 billion in 2018, according to a report by Motilal Oswal Financial Services.

The report highlighted many factors that have led to the rapid growth of the industry, including rising disposable incomes, improving range of jewelry for regular wear, improved product offerings (designs, diamonds, etc.), building trust through mandatory hallmarking by the government , and better shopping experiences in organized retail outlets.

Organized retail jewelers had only 36-38 per cent. overall share in the retail segment; however, most of the retail jewelry market continued to be dominated by unorganized/local players, comprising over 500,000 local goldsmiths and jewelers.

The report indicated that the total gold consumption in India is 66% for jewelry and the remaining 34% for bars and coins. India’s gold supply is dominated by imports and the domestic gold market has seen significant fluctuations in imports during FY18 to FY20.

The report stated that the country’s gold imports reached 980 tonnes in fiscal 2019, before declining to 720 tonnes in fiscal 2020. This volatility was due to a number of factors, including declines in global gold prices, strong economic conditions leading to increased disposable income and significant demand for gold due to traditional celebrations and weddings.

However, FY20 saw a significant decline in gold imports due to rising import duties and the initial stages of economic slowdown.

The report lists Tamil Nadu, Maharashtra, Karnataka, West Bengal and Uttar Pradesh as the five states with the highest number of organized retail jewelry stores in India.

In India, weddings and festivals are the main reasons for purchasing jewelry. Wedding jewelry continues to account for a significant portion of demand, accounting for 55% of total demand.

Everyday wear jewelry accounts for 30-35% of the Indian jewelry market. The industry is now strategically focusing on producing lightweight pieces to cater to the preferences of younger consumers, especially those who want to wear gold jewelry on a daily basis to complement Western-style outfits.

On the other hand, fashion jewelry has almost 10% share in the Indian jewelry market.

In the jewelry segment, the main components of domestic jewelry consumption are bracelets and chains, accounting for 60-70% of total sales. They are preferred by women for everyday wear. Necklaces account for approximately 15-20 percent of sales volume, with sales increasing during special occasions such as festivals and weddings. The remaining 5-15 percent of sales are made up of rings and earrings.

(Except for the headline, this story has not been edited by NDTV staff and is published from a syndicated feed.)

Featured video of the day

Prime Minister Modi inaugurates the new campus of Nalanda University in Bihar