Karat and shift: Sky-high gold prices see buyers turning to affordable jewellery

"With gold prices rising above Rs 90,000, this (daily-wear) becomes a very attractive buy because the 14-karat gold price is about Rs 6,000, which is lesser than 18-carat gold, which costs Rs 9,000.  This makes it a very affordable jewellery option—not for locking away, but for everyday wear,"  Sanjay Bhattacharjee, head of retail, Mia by Tanishq, told Moneycontrol.

The daily-wear brand, which crossed the Rs 1,000-crore turnover mark in the current financial year, expects at least a 30 percent year-on-year (YoY) hike in sales, ahead of Gudi Padwa -- the traditional New Year for Marathi and Konkani Hindus.

"This trend actually benefits us. About 50 percent  of Mia’s products are bought for gifting, and our pricing is very competitive. Our studded products start at Rs 4,999, making them very affordable." The brand currently operates 230 stores across the country, with expansion plans under works to be present in the tier 2 and tier 3 cities as well.

High interest for daily-wear segment from organised players

The daily-wear category, initially dominated by unorganised players, is becoming more competitive, with more legacy jewellers and corporate brands increasing their presence in  the space. For instance, Kalyan Jewellers fully acquired Candere last year, a brand that has been catering to the fast-growing affordable and accessible jewellery segment since 2013.

The Indian jewellery sector is undergoing a transformation, with formalisation gaining momentum and organised players now controlling 36-38 percent of the market —a significant rise from 22 percent in FY19, according to analysts.

This shift has been driven by consumer trust in branded retailers, rising disposable incomes, hallmarking regulations, and a growing demand for lightweight, versatile jewellery that aligns with modern lifestyles. Industry giants like Titan, Kalyan, Malabar and Senco are capitalising on these trends, expanding aggressively with franchise models and catering to evolving preferences for daily wear and studded jewellery, signalling a new era for India’s gold obsession.

In this market scenario, jewellers from the organised segment will definitely command the larger market share because customers are becoming quality conscious and discerning in their preferences and only the organised players have the design bandwidth and depth to meet the growing demand, according to  Malabar Group Chairman M P Ahammed.

Meanwhile, analysts suggest that the  growing preference for lighter, affordable jewellery has sparked uncertainty about whether 18-karat gold will be replaced by 14-karat gold as the dominant choice. When asked if Mia would foray into items below 14-K category, Bhattacharjee said, "We are in the experimental stage on that, as of now. We do not have anything below 14 K."

Tight budgets impacting traditional jewellery purchases 

Bhattacharjee highlighted a low single-digit impact as budget-conscious consumers, especially in western India, delay their purchases.

"In western India, where many families invest in the stock market, we are seeing some challenges. Wherever there is a strong affinity for gold, we are noticing some sales pressure.  The impact is in single digits, as of now, mainly from western states. However, we are pushing initiatives like gold exchange programmes and customer education to counteract this," he said.

However, the Titan brand is optimistic about Q1 (April-June) because of the wedding season.

"Last year, elections affected wedding-related sales, but this year, we are very confident. For instance, for weddings, families who previously bought 18 or 22-karat gold but now have budget constraints opt for 14-karat jewelry. It allows them to buy multiple pieces for gifting."