The gems and jewellery sector finds itself caught in a cloud of uncertainty. Akshat Garg, AVP of Research at Choice Wealth helps in dissecting impact of the US tariffs on the gems and jewellery sector. "The sector's reliance on the American market accounts for nearly 28% of exports (~$10 billion annually). A 26% tariff significantly erodes price competitiveness, especially against rivals like Thailand and Vietnam."
He says that the industry's margins are already running at a thin rate of 5 to 8%, and there is heavy dependence on imported raw materials wherein diamonds and gold constitute ~60% of costs. A weaker rupee further inflates input costs, compounding the pressure on profitability. Major players like Titan and Kalyan Jewellers face heightened risks of order cancellations and shrinking margins, particularly in the premium segment where U.S. consumers dominate demand.
For market expert, Ambareesh Baliga, the concern is palpable. “Gems and jewellery exports are crucial,” he says. “Even if reciprocal tariffs soften the blow, the sentiment remains fragile.” It’s not just the numbers; it’s the unease among investors." He also pointed out that most export-driven players are in the private domain, while public companies like Titan and Kalyan are more India-centric retail plays.
Siddharth Bhamre, Head of Research at Asit C Mehta, takes a more balanced view. He believes the reaction may not be as harsh as some fear, but the immediate sentiment will likely be cautious. “People will tread carefully,” he admits. “Even if the impact turns out to be milder, the apprehension itself can weigh on stocks for a while,” he added in the context of the market having mostly priced in the immediate reaction.
Siddharth Khemka, Head of Research at MOSL, says that it’s important to separate the retail-driven names from the export-heavy ones. “Not every company will be hit equally,” he explains. “Retail-centric brands like Titan and Kalyan Jewellers may fare better than those dependent on US exports.”
Satwik Jain at Generational Capital paints a more layered picture. He believes that while large-cap names with global reach might feel some squeeze, mid-cap and smaller players—rooted in the domestic market—are likely to escape relatively unscathed. Take a look at Rajesh Exports and PC Jewellers in the midcap space while smallcap key names would be Thangamayil Jewellery and TBZ (Tribhovandas Bhimji Zaveri).
“We’ve been through such uncertainty before,” he says. “Once things settle, quality names will probably attract buyers again. It’s just about waiting for the dust to clear," said market expert Kranti Bathini on an optimistic note. But for now, it’s a classic case of cautious optimism while investors with a discerning eye might still find a few sparkling opportunities amid the cautious mood.
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