CY2016 Demand Outlook: During the current year, ICRA estimates the jewellery industry to record 3 per cent value growth, which is lower than our earlier estimates of 5-6 per cent growth – this is largely owing to steady rise in gold prices denting volumes.
However, overall volumes are likely to be buffered to an extent by improvement in rural demand (on the back of better monsoons), renewed expansion thrust of organized players and higher than expected recycling of gold (with rising gold prices).
Emphasis on boosting rural economy in the Union Budget 2016-17 is also likely to spur rural demand which could augur well for the industry over the next three years.
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