Gold, silver prices surge, but jewellery demand seen rising 20-25% this festive season

Gold prices climbed 9% in August, silver jumped over 15%, and platinum was up more than 11%. On paper, that should have scared off jewellery buyers. Instead, the industry is bracing for one of its strongest festive seasons in years, with demand between September and December expected to rise 20-25%, industry estimates suggest.

Jewellers believe the usual pattern is playing out again: high prices aren't stopping people from buying; they're just changing what they buy. Consumers are shifting to lighter gold pieces, lower-carat jewellery, and gold coins that are easier to sell later if needed.

“The Diwali will be jewellery Diwali; it is going fantastic," said Abhishek Sand, co-founder of Savio Jewellery, adding that coloured gemstone and diamond pieces are seeing the strongest orders this season.

Silver is having a moment of its own. Kishor Runwal, Managing Director of Anmol Jewellers, said the metal is now pulling in buyers who once stuck to gold, helped by cheaper price points and new designs like lightweight chains, rose-gold plating and even lab-grown stones set in silver.

"Silver is doing extremely, extremely superb. It is outsmarting the gold industry," he said, while adding that this year's sales will likely match last Diwali rather than beat it.

Read Here | Gold prices may be volatile, but wedding demand remains strong: NAC Jewellers

Exchange of old gold and silver for new pieces is also becoming a bigger part of how the trade works, with jewellers pointing out that it keeps metal circulating within the country instead of pushing up imports.

Chahat Shah, founder of Svaraa by Kalamandir, spoke largely in Hindi during the discussion but flagged that lab-grown diamonds and lower-carat gold jewellery are seeing strong traction among younger, budget-conscious buyers.

Organised retail also came up as a running theme. Sand pointed out that branded jewellery chains, which struggled a decade ago, are now growing fast and taking share from smaller independent jewellers, a trend he expects to continue as more players expand into new cities over the next five years.

Gold loans and gold-for-gold exchange were flagged too, with jewellers noting that a large share of transactions now involve customers trading in old jewellery rather than buying with fresh cash, a shift that is also helping ease the country's gold import bill.

On silver, hallmarking remains a work in progress. Runwal said India's hallmarking infrastructure is still built mainly around gold, and that the silver trade will need more certification centres before compulsory hallmarking becomes practical, though he expects that to change gradually.

None of the three companies indicated any near-term IPO plans, though Savio Jewellery didn't rule it out for the future.

For the entire discussion, watch the accompanying video