Gold's record run: Heirlooms put on sale, buyers turn to lightweight bling

The bustle, so typical of a wedding season, is conspicuously absent in Bowbazar, Kolkata’s storied jewellery district. Around 350 shops line this central stretch of the city, but the ennui in the air is unmistakable.

 

Gold prices have skyrocketed to a point where shoppers’ budgets are falling woefully short, says a salesperson at Gold Emporium. “Sales are down significantly. Those who want to gift gold to their near and dear ones are not getting anything worthwhile within their budget. Even something as basic as a nose pin now costs ₹6,000. And who gives a nose pin?”

 

“People are looking for gold chains in 2 grams. Is it possible?” asks the owner of another shop.

 

The story hardly varies across Bowbazar – footfall is thinning and the demand for lighter, lower-weight pieces is on the rise. As safe-haven assets gain traction in the face of global uncertainty, the rally in gold prices has put consumers in a spot.

 

Early last week, domestic gold prices breached the psychologically significant ₹1 lakh mark per 10 grams in the retail market. Though prices have since softened, they remain about 20 per cent higher than the average across 2024-25.

 

Even with the slight correction, shoppers are hesitant to open their wallets. “They are in wait and watch mode,” says Bablu De, working president of the Swarna Shilpa Bachao Committee.

 

With budgets under strain, shoppers are turning to old jewellery to meet new needs. “Consumers are looking for wedding jewellery within their budgets. Old gold exchange has gone up by 40 per cent,” notes Suvankar Sen, managing director and CEO of Kolkata-headquartered Senco Gold.

 

The same story plays out across other gold hubs around the country. 

 

Chandni Chowk, Delhi

 

The normally teeming lanes of Chandni Chowk lead to an unexpectedly quiet Dariba Kalan, the city’s historic jewellery and ornaments hub.

 

“Business has gone down significantly in the past three months as gold prices rallied. The few people who do come are increasingly looking at 18 carat (kt) or 14 kt pieces,” says Gaurav Gupta, owner of Radhey Kishan Gopal Kishan Jewellers, in business since 1911.

 

Gupta, who is also treasurer of the Dariba Jewellers Association (DJA), says gifting habits are changing too.  “People would usually gift 10-gram gold chains for weddings, birthdays, and other occasions. But with prices rising exponentially, many are now opting for other gifts or simply giving cash,” he adds.

 

At Ratan Chand Jwala Nath Jewellers, the mood is no different. “The geopolitical situation has pushed gold prices to a new high, breaking a psychological barrier. Our business is down by almost 50 per cent over the past three months, and buyers are opting for lighter pieces,” says Tarun Gupta, owner and president of the DJA.

 

At the end of the lane, however, Shri Ram Hari Ram Jewellers is bustling — but not with buyers. The crowd is gathered at the counters, weighing their old jewellery to sell.

 

In India, gold is more than an investment; it is an emotion. Selling gold, particularly heirlooms, is often a measure of desperation. But today, with the yellow metal at historic highs, sentiment is shifting. 

 

“Our children have moved to Canada and don’t want to wear such heavy jewellery anymore. It’s just lying in bank lockers,” says a 55-year-old woman selling her pieces. Shri Ram Hari Ram jewellers reports a 25 per cent rise in such sales.

 

“While our overall sales are down by 50 per cent, we are seeing a distinct rise in customers selling jewellery. Traditionally, this happened only in dire straits -- but that’s no longer the case,” says Mahesh Chand Gupta, proprietor of the store, founded in 1789.

 

Zaveri Bazaar, Mumbai

 

In the narrow bylanes of the chaotic Zaveri Bazaar, the story remains the same. Its streets hum with activity, but the wedding season isn’t drawing the usual crowds. Walk-ins are mostly from loyal customers; wedding shoppers are mostly exchanging old gold.

 

At U T Zaveri & Sons, Sobha Mehta is seen trading old jewellery for new designs for her daughter’s wedding. “I don’t like exchanging old jewellery. But with gold prices so high, I have no choice but to sell the old to buy the new,” she says.

 

Owner Jitu Jain concurs: “We are seeing very little new purchasing. Most customers are exchanging old jewellery.” Footfall, he adds, has dropped by nearly 65 per cent.

 

Rajiv Popley, director at Popley Group, says the trend has been gathering pace. “Two years ago, when gold was around ₹60,000 per 10 grams, only about 5 per cent of jewellery purchases involved exchanges. Now, it’s 20 per cent.” He expects a flat demand this Akshaya Tritiya.

 

Still, there are pockets of optimism. At Umedlal Tilokchand Zaveri, a century-old store, loyal customers continue to make purchases. Owner Kumar Jain is anticipating an 8-10 per cent increase in sales ahead of Akshaya Tritiya on April 30.

 

A mixed bag in Chennai

 

In Chennai, where gold buying is woven deeply into cultural fabric, the trend is slightly different. Shoppers are using the recent dip in prices to stock up ahead of Akshaya Tritiya.

 

It’s 2 pm, but Vummidi Bangaru Jewellers in Anna Salai is bustling. South India’s deep-rooted love for gold is no secret, and long-time buyers feel vindicated.

 

“Gold is a secure asset, just like land,” says Ranjitha Raj, who runs the children’s clothing brand Lilliput Lane. Among most gold buyers that Business Standard spoke to, the sentiment was clear: Despite a 30-40 per cent increase, gold is seen as the safest investment in turbulent times.

 

“We are not seeing a dip in volume yet. If prices soften even by 3-5 per cent, we could see a sixfold surge in sales during Akshaya Tritiya,” says Amarendran Vummidi, managing partner, Vummidi Bangaru Jewellers India.

 

Still, rising prices are pushing some to opt for lighter, even 14kt jewellery -- an unusual trend in the South. “The surge has restricted my purchases by 50 per cent,” says Shree Kalpana, a housewife who buys gold twice a year.

 

The big question now: Will Akshaya Tritiya bring a gold rush?

 

The Madras Jewellery Association isn’t overly optimistic. “Walk-ins have already dropped. Demand is medium. This Akshaya Tritiya may only be good if prices drop by at least 10 per cent in the coming days,” says Santha Kumar, secretary of the Association and owner of SR Jewellery.

 

In Tamil Nadu, the wedding season begins in mid-May -- and with it, the real test for gold demand.