Jewellers expect Dhanteras sales to reach ₹66,000 crore, driven by high gold prices rather than increased physical demand. With inflation straining budgets, consumers are opting for lighter jewellery and smaller coins, creating a divergence between total transaction value and actual volume growth.
Retailers across India are gearing up for Dhanteras 2026, with the All India Jewellers and Goldsmith Federation projecting total sales to hit ₹66,000 crore. While this represents a notable year-on-year increase, industry data suggests the rise is primarily driven by elevated gold and silver prices rather than a surge in the actual quantity of gold sold.
The Gap Between Value and Volume
Financial data from the past few months shows a clear divergence between the value of demand and physical volume. Consumers are paying significantly more to purchase the same amount of gold as in previous years. This trend is forcing a change in buying habits, with many households gravitating toward lightweight jewellery and smaller denominations of coins to keep their total spending within budget. The phenomenon of consumers spending more but acquiring less weight has become a central theme for the jewellery sector this festive season.
Inflation and Consumer Spending
High prices remain a hurdle for the average buyer. Gold prices in the current festive season remain about 7% to 10% higher than they were during Dhanteras in 2025. When combined with sustained inflation in essential categories like food, energy, and transportation, households are finding their disposable income stretched. This pressure on the middle-class budget means that while the value of festive purchases remains high, discretionary spending on luxury or heavy jewellery is facing challenges.
To manage these costs, many buyers are increasingly choosing to exchange old ornaments for new pieces. This strategy allows families to participate in the traditional Dhanteras purchase while mitigating the need for a large upfront cash payment. For retailers, this shift is critical to monitor. While revenue figures may appear healthy due to the higher price of bullion, flat or declining physical volume could limit profit margins if companies cannot maintain their sales efficiency or manage inventory costs effectively.
What Investors Should Monitor
For those tracking the listed jewellery sector, the focus will be on whether retail chains can sustain their profit margins despite the volume pressure. The ability of companies to attract footfall through design innovation, exchange schemes, and loyalty programs will be key to navigating this environment where price sensitivity is high. Investors will likely look for commentary in upcoming quarterly results regarding how much of the revenue growth came from price hikes versus actual volume expansion. The sustainability of consumer demand, especially as inflationary pressures on essential goods persist, remains a key factor to watch in the coming quarters.