Indian policy rarely sorts a sector into winners and losers with this much clarity. The Centre on 13 May increased the import duty on gold from 6% to 15%, structured as 10% basic customs duty stacked with a 5% Agriculture Infrastructure and Development Cess. India imported 721 tonnes of gold worth $72 billion in FY26, a record by value (up 24%) but slightly lower by volume (down 4.8%), as prices surged from $77,000 to $100,000 per kg.

Monthly imports averaged 83 tonnes in the first two months of 2026, up sharply from a 53-tonne monthly average in 2025, per the World Gold Council. Q1 2026 demand in value terms nearly doubled year-on-year to a record $25 billion.

However you slice the macro story, gold-linked listed companies now fall into two clear camps. One group's fortunes turn on margin events. The other is simply being carried by favourable conditions.

Let’s start with the cost side.

Big Tax, Shrinking Ticket Sizes

The first cost involves pre-bought inventory. Selling jewellery in India means sitting on a lot of inventory. In that stock, gold is roughly 80% of the price tag. When the duty was cut from 15% to 6% in the July 2024 Union Budget, Kalyan booked a one-time inventory hit of roughly Rs 69 crore in Q2 FY25, and Senco took about Rs 30 crore in the same quarter.

The May 13 reversal delivers the inverse, a revaluation gain on stock already in showrooms. But that is a one-quarter accounting event. The lasting damage sits on the customer.

Kalyan’s Executive Director, Ramesh Kalyanaraman, had guided that a 15% move in the gold price drags inventory by roughly 10%. International spot gold is already near $4,700 an ounce. The leading indicator in the festive quarter will not be footfalls, as customers will still walk in. What will shrink is what they spend per visit.

Among the listed domestic jewellers absorbing the cost pressure, Kalyan is the largest, with Rs 35,743 crore of FY26 revenue and the biggest franchise-driven store base.

PN Gadgil, the Maharashtra-anchored mid-tier, has guided to roughly Rs 10,000 crore in revenue in FY26 on a tighter net margin near 4.4%, with regional density rather than scale as its defence. Senco runs the same playbook, raising making charges and holding them through bullion easing.

Thangamayil, the Tamil Nadu-based jeweller, has an advantage, as wedding and temple buyers in the state are less likely to cut back when prices go up than buyers elsewhere. PC Jeweller is still recovering from its post-2018 troubles. Its balance sheet is thin, leaving it with little room to adjust its product mix or pricing to absorb the increase in duty.

The Return Of Smuggled Gold

The second cost here is the one that doesn't show up in any company's quarterly numbers. It's the loss of formal-sector market share to the grey market. When the duty was cut to 6%, smuggled gold lost its price advantage, and the listed jewellers (Kalyan, Titan, PN Gadgil, etc.) gained share from the unorganised trade.

At 15%, that gap reopens: smugglers can again undercut listed retailers on price, and the volume that flows through unofficial channels — historically 100-plus tonnes a year at this duty level — bypasses the listed players entirely.

Turn to the windfall side. Muthoot Finance held Rs 1.65 lakh crore in loans on its books in the first nine months of FY26, up 48% from a year earlier, and earned a profit of Rs 7,048 crore over those nine months, up 91%. Manappuram Finance ended FY26 with a loan book of Rs 63,798 crore, up 48.3%, of which gold loans alone rose 99.1% to Rs 50,953 crore. South Indian Bank closed the year with Rs 24,729 crore of gold loans, up 45.6%, which is 28% of its retail lending. Every one of these loans is backed by gold whose landed value has just gone up by nine percentage points after the duty hike.

The cushion between what these lenders have lent and what their collateral is worth widens without a single new loan being written. For fresh loans, the same five grams of pledged jewellery now supports a larger borrowing, with the lender's safety margin intact.

Households that might once have sold jewellery to raise cash will now pledge it instead, because the price is too good to lock in by selling. This tailwind lasts as long as the duty does.

Rules Cap The Lending Feast

The RBI's 2025 gold-loan rules cap how much lenders can advance against a given quantity of pledged gold, which limits how aggressively they can ride the price rise. The same rules also subject larger loans to fresh checks on how the money will be used, and tighten the practice of pledging the same jewellery across multiple loans. Together, these caps shape how the loan book can grow from here.

The symmetry across the two sides is what makes this a structural story rather than a sector story. The household that walks into Kalyan in August to buy a wedding set is the same household that walks into a Manappuram branch in October to pledge a fraction of it.

Listed lenders, thus, will collect the windfall through collateral revaluation and the sell-becomes-pledge shift; the gap between Muthoot and Manappuram will be set by the multiple, not the operating performance. The duty has picked a side; the market will price the rest.