Jewellery Stocks Slide After PM Modi Calls For Gold Purchase Curbs

Prime Minister Narendra Modi on Sunday called for a nationwide push towards austerity as India grapples with soaring crude oil prices and mounting pressure on foreign exchange reserves amid the ongoing West Asia conflict.

Speaking at an event in Hyderabad, Modi urged citizens to reduce fuel consumption, postpone non-essential foreign travel and avoid gold purchases for a year. His remarks come even as state-run fuel retailers continue to hold petrol and diesel prices steady in Delhi at ₹94.77 and ₹87.67 per litre, respectively, despite rising global energy costs.

What Is The Possible Stock Market Impact?

The market reaction was immediate, particularly across jewellery stocks, as investors feared a slowdown in discretionary gold purchases.

Jewellery stocks witnessed sharp selling pressure. Sky Gold and Diamonds shares plunged as much as 12% during intra-day trade on the BSE, while Thangamayil Jewellery and Senco Gold dropped nearly 9% each. Kalyan Jewellers fell 8%, while Goldiam International and Titan Company declined around 6% amid concerns over a possible slowdown in jewellery demand.

As of 01:45 PM, Kalyan Jewellers shares were down 8.81% at ₹387.10, Sky Gold and Diamonds (-7.58% at ₹500.20), and Titan Company Ltd (-6.19% at ₹4,230.50).

For oil marketing companies, the Prime Minister’s appeal may offer some relief if lower fuel consumption helps ease pressure from rising global crude prices while retail fuel prices remain unchanged.

Stocks such as Indian Oil Corporation, Bharat Petroleum and Hindustan Petroleum could benefit if moderation in fuel demand reduces inventory and pricing stress.

The broader impact, though, may be less favourable for consumption-driven sectors. Analysts expect discretionary spending to slow if households begin cutting back on travel, jewellery purchases and other non-essential expenses following the government’s austerity push.

Travel and hospitality firms could also see near-term impact. Stocks linked to aviation and hotels, including InterGlobe Aviation, Indian Hotels Company, Lemon Tree Hotels, and EIH Limited, may remain under pressure if both corporate and leisure travel activity softens in the coming months.

Why Is PM Modi Asking Indians To Cut Fuel Use?

Modi said the global crisis demands collective responsibility from citizens and industries alike. He urged people to rely more on public transport systems such as metro rail networks, use carpooling whenever possible and shift towards electric vehicles.

“In this time of global crisis, we have to make a resolution keeping duty paramount,” Modi said while addressing the gathering in Telangana.

The Prime Minister also suggested reviving Covid-era work practices, including work-from-home arrangements, online meetings and virtual conferences, saying such measures could help reduce fuel demand and save foreign exchange reserves.

Alongside personal transport changes, Modi encouraged businesses to move freight transport towards railways and asked farmers to reduce dependence on diesel-powered systems and chemical fertilisers. He also promoted natural farming and solar-powered irrigation pumps as alternatives.

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Focus Shifts To Foreign Exchange Conservation

A major part of Modi’s speech centred around conserving foreign currency as India’s import bill continues to rise. Crude oil imports stood at $121.8 billion in 2025-26, and officials fear costs could climb further if shipping disruptions through the Strait of Hormuz persist.

The Prime Minister appealed to citizens to avoid overseas vacations, destination weddings and unnecessary foreign travel for at least a year. He also urged households to reduce edible oil consumption and avoid buying gold during the current crisis period.

India’s gold imports rose 24% to a record $71.98 billion in 2025-26, contributing significantly to the country’s widening trade deficit, government data showed.

Analysts said the market is also factoring in the possibility of a higher import duty on gold to curb imports and reduce pressure on the rupee and foreign exchange reserves.

The Union Petroleum Minister, Hardeep Singh Puri, said oil marketing companies are absorbing massive losses to shield consumers from higher prices. According to him, under-recoveries during the current quarter could rise to nearly ₹2 lakh crore.

Sources:

Hindustan Times

NDTV Profit

Business Standard