Editor’s Note
Soaring gold prices are reshaping consumer behavior in India. As this article details, a significant shift toward exchanging old jewelry for new, lighter pieces is providing a crucial buffer for retailers like Titan’s Tanishq, helping to maintain sales momentum in a high-cost environment.
Skyrocketing gold prices, which crossed ₹1.5 lakh per 10 grams and reached nearly ₹1.8 lakh by the end of January 2026, have completely transformed how Indian consumers buy jewelry. According to Titan’s renowned jewelry brand Tanishq, nowadays, in more than half of the sales, customers are exchanging their old gold jewelry to purchase new, lighter designs. This is a major relief for Titan, as it helps sustain sales despite high prices. The company has also observed that customers are now paying more attention to lighter gold jewelry like 18-carat and lower-carat diamonds (9- and 14-carat).
On the other hand, Titan is working on a major strategy in its Lab-Grown Diamond (LGD) segment through the ‘be Yon’ brand. The company’s goal is to increase the low usage of diamonds in India (penetration rate around 10-12%). LGDs are significantly cheaper compared to natural diamonds, making them accessible to the common man. Titan’s thinking is to start customers with LGDs and later steer them towards premium natural diamonds.
Market reports indicate that LGDs could grow from a 12% share in 2024 to constitute nearly 16% of the global diamond market by 2029. The current value of the LGD market in India is ₹3,452 crore ($400 million) and is expected to reach ₹5,179 crore ($600 million) by 2028. Meanwhile, the global LGD market could reach $8.31 billion by 2032, with a potential annual growth (CAGR) of 13.73%.
Titan’s jewelry segment recorded a robust revenue growth of 41% in Q3 FY25-26 compared to the previous year, with domestic growth at 38%. This increase was primarily due to higher average selling prices (ASP) driven by rising gold prices, although there wasn’t a significant increase in the number of customers. The consolidated operating margin was 8.7% in Q2 FY2025, while the normalized EBIT margin was 11.4%. According to estimates for Q2 FY2025-2026, the net profit margin could be 5.95%.
Titan’s entire strategy is backed by its strong fundamentals. The company’s market cap is around ₹3,67,583 crore and it is trading at a P/E multiple of 89-96x. In the financial year 2025, the company’s revenue was ₹57,818 crore. Analysts’ confidence in Titan also remains, with an average target price for the share set at ₹4,500-₹4,650 alongside a ‘Buy’ rating. Since January 2026, Arun Narayan has taken over as CEO of the jewelry division, who has nearly three decades of experience in the Tata Group and was leading Tanishq India since 2020. His appointment will prove crucial in advancing this dual strategy.
Although Titan’s strategy appears strong, it’s also necessary to pay attention to some risks. The company’s debt-to-equity ratio increased to 2.23 by September 2025, which is significantly higher than FY24’s 0.4. In such a scenario, if revenue growth slows or interest rates rise, pressure on profits could mount. Sales are increasing, but a slight decline in operating profit margin is being observed.
Aggressive expansion in LGDs could impact the sales of the company’s expensive natural diamonds. Additionally, major players like Kalyan Jewellers, Senco Gold, and Malabar Gold are also in this race, which could pose a stiff challenge for Titan. Historically in India, gold is viewed as a store-of-value, so a large and rapid shift towards LGDs could also be slower than expected.
Overall, Titan Company’s future outlook remains cautiously positive. Analysts believe the company’s strong brand value and strategic diversification will propel it forward. Managing the pressure of high gold prices through the exchange program while simultaneously establishing a foothold in the rapidly growing LGD market will be crucial for Titan. The Indian jewelry market is expected to see continuous growth, and the LGD segment could prove to be a major revenue source for Titan in the future, provided the company can effectively manage competition and margins.