Shanti Gold, PC Jeweller & other jewellery stocks rally up to 10% as gold ETF FoF subscriptions face curbs

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Agencies

Shanti Gold International shares rose as much as 7.6% to hit a fresh 52-week high of Rs 421.85, while Sky Gold and Diamonds gained 6.1% to reach a record high of Rs 1,064. PC Jeweller advanced 9.9% to Rs 15.89, also touching a fresh 52-week high. Tribhovandas Bhimji Zaveri climbed 5% to Rs 760.75, its 52-week high.

Gold investment shifts into focus

Restrictions on fresh subscriptions and new systematic registrations in gold ETF FoFs took effect across different fund houses on October 15 and 16. While fund houses have not cited a common reason for the move, Shriram Mutual Fund said the restrictions were imposed in line with instructions from Sebi conveyed through the Association of Mutual Funds in India (AMFI).

The curbs are temporary and do not affect redemptions. Existing systematic investment plan (SIP) and systematic transfer plan (STP) instalments registered before the respective effective dates will also continue at applicable net asset values (NAVs), according to communications issued by several fund houses.

The timing is significant as Dussehra and Diwali approach, a period when demand for gold typically strengthens. With fresh investments through some financial products temporarily restricted, investors' gold-buying preferences and demand for physical gold and jewellery are coming into focus during the festive season.

Gold ETF inflows had already surged in September. According to AMFI data, gold ETFs attracted net inflows of Rs 4,450.61 crore during the month, up 71.4% from Rs 2,596.70 crore in August.

Festive demand keeps jewellery stocks on radar

Analysts expect jewellery demand to remain resilient despite elevated gold prices.

“Despite any negative sentiment around gold, whether prices rise or fall, demand for gold in India is likely to remain steady,” said Kranthi Bathini, director of equity strategy at WealthMills Securities.

Ravi Singh, chief research officer at Mastertrust, expects the sector to benefit from festive demand, wedding purchases and healthy consumer sentiment. Consumers are adapting to higher gold prices through lightweight jewellery, lower ticket purchases and old gold exchanges, he said.

Singh sees organised players such as Titan Company, Kalyan Jewellers and Senco Gold benefiting from market share gains, although margins and volume growth remain key monitorables.

Singh has also identified Senco Gold as a stock with growth potential, while Bathini has flagged newly listed Lalithaa Jewellery Mart alongside Titan and Kalyan. For jewellery retailers, the festive season will put the focus on sales volumes, revenue growth, realisations and margins as consumers navigate elevated gold prices.