The continuous increase in retail prices of gold to a historical maximum is expected to reduce the sales volume of gold jewelry retailers organized by 9-11 percent in fiscal year 2026. However, with the prices and realizations that are expected to be significantly Pent. Eyy, Yoy income, yoy income, yoy income, yoy income, yoy income, yoy income yoy, yoy income.
This comes to the back of four consecutive years of income growth of more than 20 percent, which has seen the industry grow 2.5 times since the 2011 fiscal year.
However, the volume has remained moderate with consumers who buy smaller amounts amid budget limitations due to higher prices.
As demand decreases, retailers are promoting sales through promotions and discounts in the middle of the growing penetration in levels of level II and -III.
Operational profitability will increase between 30 and 40 basic points (BP) Y-on-Y, driven by inventory gains.
The highest prices will also increase working capital loans to buy inventory for existing and planned stores.
In fiscal year 2025, retailers, a 4-5 percent blow to volume as gold prices fired 25 percent of you amid geopolitical and economic groups, said a report of Crisil qualifications. In mid -April, gold prices already rose 20 percent compared to the average price in fiscal year 2015.
Himank Sharma, director of Crisil Ratings said that the recent leap in prices occurred just before the start of festive and marriage seasons in the first half of April, which limits the impact on demand.
The demand, designed lower, remains supported by the tax cuts in gold imports announced last year, he said.
The highest achievements will boost another year of two-digit revenue growth for organized retailers, resulting in revenues of RS 4.5-5 Lakh million rupees for the industry.
Jewels sold at higher prices than purchase prices will result in an inventory gain of 20-30 PB and push the operating margin closest to the average of seven years or 8 percent in fiscal year 26.
Gold debt
Jewelry retailers qualified by Crisil’s grades will increase as the cost of inventory refueling and the new store inventory increase due to the highest prices.
Gaurav Arora, associate director, Crisil Ratings said that improved income and operational profitability will also absorb the impact on debt protection metrics with a median interest coverage that looks healthy, more than 6 times in fiscal year 2026.
Posted on April 23, 2025
