Market feedback suggests that purchases were deferred during the price spike. However, as prices eased around regional festivals, demand improved but was overall subdued. Retailers focused on marketing campaigns and promotional offers to drive sales. Exchange of old gold jewellery remained a key contributor, reportedly accounting for 40–50% of sales, while investment demand for bars and coins continued to be robust, WGC said.
It further added that listed jewellery retailers delivered a strong performance in Q1 2026 (Jan–Mar), with revenue growth ranging from 32% to 124% y/y, making it the best quarter of the financial year for several retailers. Growth was driven by a robust wedding season and steady discretionary demand, which remained resilient despite the elevated and volatile gold prices. Regional festivals also supported sales. Retailers also benefited from an increase in the average ticket size of purchases, growth in plain gold jewellery, and a sharp rise in coin sales. Additionally, digital channels continued to gain traction, with some jewellers reporting over a fourfold y/y growth in online revenues.
Retailers continued their expansion push, adding between 7 to 38 stores during the quarter, although some launches were delayed due to geopolitical supply disruptions. Most retailers have indicated plans to continue expanding their store network, reflecting confidence in long-term demand and a focus to deepen market presence.
Overall, the quarter highlighted strong domestic demand resilience alongside strategic growth initiatives.
Despite significant redemptions and in contrast with the trend of North American and European ETFs, Indian gold ETFs extended their inflow streak to the 11th consecutive month in March 2026, recording net inflows of INR 22.7bn (US$244mn) as per data from the Association of Mutual Funds of India (AMFI). This, however, was the lowest monthly net inflow in seven months. The moderation was primarily driven by record redemptions of INR 31.6bn (US$341mn), likely reflecting continued profit-taking, a trend carried forward from February. Nevertheless, cumulative gold holdings rose to 115t as of end March, in line with our initial estimates, indicating underlying resilient demand.
Following the relative weakness in March, April has seen a recovery in flows. During 1–10 April, net inflows stood at INR 17.36bn (US$187mn), contributing an additional 1.2t to collective holdings.Q1 2026 recorded the strongest quarterly inflows into Indian gold ETFs, with net inflows of INR 316bn (US$3.45bn), resulting in an addition of approximately 20t to total holdings. Notably, nearly 80% of these inflows were concentrated in January, reflecting strong investor sentiments amid the rally in gold prices.
The investor interest in gold ETFs has been sustained and continues to broaden, albeit at a slower pace, as reflected in the number of accounts or folios of gold ETFs. March saw the addition of 0.31mn new accounts (vs 0.65mn in February), taking the total number to 12.39mn. Furthermore, gold ETFs’ share in the overall assets under management (AUM) of mutual funds has seen a rise to 2.3% from 0.9% a year ago.