India's gold jewellery sector navigates record prices and political pressure

India's gold and jewellery sector is showing signs of both consolidation and strain as prices sit at record levels. GRT Jewellers is seeking a majority stake in listed rival Tribhovandas Bhimji Zaveri in a deal that could be worth up to $109 million, according to the Economic Times, a transaction that would expand GRT's footprint using TBZ's existing store network and is subject to regulatory approval and an open offer to other shareholders. Separately, Senco Gold has set a turnover target of Rs 10,000 crore for the coming financial year, with management noting that old gold exchange now accounts for nearly half of total sales as customers trade in existing pieces rather than pay full price for new gold amid high market prices.

Layered on top of this is a political intervention: Prime Minister Narendra Modi has again urged Indians on social media to avoid buying gold unless necessary, framing it as part of a push towards self-reliance and domestic investment. The comments come as India's gold imports hit a record in the last financial year even as import volumes by weight declined, illustrating how price rather than demand volume is driving the import bill higher. Jewellery stocks reportedly slid on the renewed comments.

Together these threads show a sector working through a genuine structural shift. Consolidation among organised jewellery retailers is accelerating as scale becomes more important against a backdrop of high input costs, while consumers are increasingly recycling existing gold holdings rather than buying new metal outright. The prime minister's repeated interventions add a layer of political risk that organised retailers, many of whom are listed or preparing to list, will need to factor into growth planning. Watch whether the GRT-TBZ deal completes on the terms outlined, and whether political messaging around gold buying begins to show up in quarterly volumes rather than just sentiment.

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