Jewellery Stocks Surge as Budget 2025 Cuts Customs Duty

Jewellery stocks soared on February 1 after Finance Minister Nirmala Sitharaman announced a customs duty reduction, boosting investor confidence.

Jewellery stocks soared on February 1 after Finance Minister Nirmala Sitharaman announced a customs duty reduction, boosting investor confidence. The new tax regime, which offers income tax relief, is expected to drive household spending and investments, even as broader markets remained weak.

Jewellery stocks outperformed the market downturn on February 1, rallying after the Union Budget 2025 unveiled a cut in customs duty on jewellery imports. Additionally, tax benefits under the revised regime provide relief to individuals earning up to ₹12 lakh, likely boosting consumer spending, savings, and investments. This shift has strengthened optimism in the jewellery sector, lifting stock prices despite overall market weakness.

Customs Duty Reduction to Drive Growth

The Finance Minister lowered the customs duty on jewellery articles and parts from 25 per cent to 20 per cent, effective February 2, 2025. Additionally, platinum findings will now attract a 5 per cent duty instead of 25 per cent, reducing import costs and improving profit margins for jewellery manufacturers and retailers.

Moreover, the removal of IGCR conditions for duty-free imports of Lab-Grown Diamond (LGD) seeds is expected to boost demand for LGDs. Another key measure is the introduction of separate HS codes for platinum and gold alloys, aimed at curbing malpractices and ensuring fair trade.

Jewellery Stocks Gain on Budget Announcements

Following these measures, several jewellery stocks saw strong gains:

• As of now, Ethos surged 8.69 per cent on the BSE.
• Goldiam International climbed 5.47 per cent on the BSE.
• Motisons Jewellers Ltd. rose 4.99 per cent on the BSE.
• PN Gadgil Jewellers Ltd. gained 2.38 per cent on the BSE.
• Senco Gold advanced 5.69 per cent on the BSE.
• Titan jumped 2.31 per cent on the BSE.

Industry Expectations Still Unmet

Despite these positive changes, the industry had higher expectations from the Budget. Gold import duty remains unchanged, which continues to be a cost concern for jewellers. Additionally, industry stakeholders had sought a dedicated regulator for digital gold to improve transparency and investor confidence. There were also calls for better incentives under the gold monetisation scheme, which aims to reduce reliance on imported gold by encouraging households to deposit idle gold with banks.

While some demands remain unaddressed, the customs duty cuts and tax incentives are seen as key growth drivers. The measures introduced in Budget 2025 are expected to boost domestic demand, lower costs, and improve investor sentiment, strengthening the outlook for India’s jewellery sector. 

Disclaimer: The article is for informational purposes only and not investment advice.