Silver's super surge: Motilal bets metal will hit ₹2,45,000/ kg by 2026-27

Silver isn’t just for jewellery anymore — it’s turning into one of the hottest investment stories of the decade. According to a new report by Motilal Oswal Financial Services (MOFSL), titled “Silver 2030 – The Unprecedented Rise,” the metal is in the middle of a long-term bull run that could take prices to $75–77 per ounce by 2027, up from around $51 currently — a nearly 50% jump.

 

Why silver is booming

 

Silver’s rise is being powered by its dual identity:

 

It’s a precious metal like gold, used as a safe-haven during uncertain times.

 

And it’s a critical industrial metal, essential for solar panels, electric vehicles (EVs), 5G, and even AI hardware.

 

 

Today, almost 60% of global silver demand comes from industries — mainly clean energy and technology — making it a must-have for the world’s green transition.  "The implication for INR-denominated assets is clear: a rising USD silver price combined with simultaneous INR depreciation creates powerful leverage. If the dollar price of silver reaches the bullish targets of $70 per ounce by 2027 and the rupee depreciates to the upper end of the projected 92.00–95.00 range, the percentage returns for Indian investors are significantly enhanced. This compounding effect mitigates the impact of potential local price corrections and enhances silver's role as a portfolio stabilizer in an environment of currency weakness," Motilal Oswal in a report. 

 

But here’s the twist: supply can’t keep up.

Global silver output has lagged behind demand for seven years in a row, and this deficit is expected to continue. Mining supply can’t rise quickly because silver is mostly produced as a by-product of other metals like zinc and copper.

 

The result? A tight market, falling inventories, and prices that are likely to stay high.

 

What it means for investors:

 

For Indian investors, the outlook is even brighter.

Since silver prices are denominated in US dollars, and the rupee is expected to weaken to around ₹92–95 per USD by 2027, silver’s returns in rupee terms could be magnified.

 

MOFSL estimates that silver could reach ₹2,45,000 per kg by 2026–27, thanks to this double boost from both global prices and currency movement.

 

Silver also tends to move 1.7 times faster than gold — which means it can deliver sharper gains (and sharper falls). 

"The investment case for silver in India is accelerating rapidly, moving beyond traditional cultural demand into institutional and retail investment vehicles. Silver ETFs in India have been notable outperformers in 2025, surging by approximately 69% year-to-date. This performance has attracted significant flows, evidenced by a 180% increase in monthly silver ETF inflows in August 2025, reaching billion, compared to the previous fiscal year average of billion.

 

While gold ETFs maintain higher overall investor flow due to established cultural dominance and liquidity, the surge in silver ETF investment demonstrates growing institutional and retail interest in silver as both a high-beta growth investment and a hedge against inflation and geopolitical tensions. These ETFs, often backed by actual physical silver stored in vaults, provide efficient exposure to the global structural bull market," said the brokerage. 

How to Invest in Silver Smartly

 

If you want to add silver to your portfolio, there are three main options:

 

Silver ETFs – These are easy to buy on your demat account, track international silver prices, and remove storage hassles.

 

 Good for: Long-term investors and first-time buyers.

 

Physical Silver (bars or coins) – Offers direct ownership but comes with making charges, GST, and storage costs.

 

Better for: Those who prefer tangible assets.

 

MCX Futures – For experienced traders who can handle short-term volatility.

 

MOFSL suggests that investors can use ETFs for steady exposure, while traders may use MCX futures tactically to take advantage of short-term price movements.

 

Here's what the brokerage says: 

 

We think that investment case for silver through 2027 is on the endurance of a multi-year structural supply deficit, driven by inelastic mining output and accelerating demand from the green economy.

 

• Short term (2025–2026): Supply cannot respond fast enough. Tightness and backwardation likely persist.
•  Medium term (2027–2028): Recycling helps modestly; some destocking at higher prices possible.
•  Long term (post-2028): New projects and recycling could stabilize market — but at higher price levels ($65–75/oz).

 

Fundamental Support: The core price appreciation is supported by irreversible, mandatory industrial consumption in solar PV and electric vehicles, giving the current rally a foundational strength unlike those seen in previous decades.

 

Inventory Crisis: Global visible inventories are being depleted at an annual rate of approximately 150Moz, leading to critical lows by the end of 2027. Market microstructure signals, such as periodic backwardation and high EFP spreads, confirm acute physical tightness and logistical stress.

 

Compounded Returns in INR: The simultaneous bullish factors of a surging USD silver price (targeting $77/oz by 2027) and a depreciating INR (projected 92.00–95.00 INR/USD range) provide compounded return potential, making silver a strategically compelling allocation for INR-based wealth creation. However, volatility is extreme (implied volatility on silver ETFs has spiked into the 80th-90th percentile), meaning prices will swing widely. The combined takeaway: current futures/backwardation signals urgency to hold physical now, as “spot > future” historically precedes 20–50% rallies in months.

 

The projected price targets for 2027 are attainable because the market must, by necessity, price silver high enough to ration demand, particularly from the industrial sector, to alleviate the structural deficit. For the majority of Indian investors, acquiring exposure efficiently through MCX futures till the market cool off to take the advantage of inverted market structure and backwardation, and till the forward premiums are higher than the normal rate of return and then shift to Silver ETFs for the long term purpose is the optimal strategy to capitalize on this enduring structural bull market. 

Risks to Keep in Mind

 

Silver’s outlook is strong, but it’s not risk-free:

 

It’s volatile — prices can swing 5–10% in a week.

 

A global slowdown could reduce industrial demand.

 

High prices might push companies to use less silver (a process called “thrifting”).

 

Still, the underlying demand from solar, EVs, and electronics means silver’s story is structurally bullish over the next few years.