Amid rising geopolitical tensions and fluctuating gold prices impacting consumer sentiment, Malabar Gold & Diamonds is pushing forward with aggressive expansion and a stepped-up investment pipeline.

As part of its expansion strategy, the jewellery retailer plans to open 50 new showrooms in FY27, after adding around 40 stores in the current financial year.

“We are planning a significant expansion, with around 40 new stores opening this year and a target of nearly 50 stores going forward,” said O. Asher, Managing Director - India Operations, Malabar Gold.

With an annual turnover of $7.36 billion, the Kerala-based Malabar Group company is currently among the top five jewellery retailers globally, operating a network of over 425 showrooms across 14 countries, along with manufacturing facilities spanning India, the Middle East, the Far East, the US, the UK, Canada, Australia, and New Zealand.

Capex push to fuel expansion

The growth push will be funded by higher investments, with the company setting aside ₹5,200-5,300 crore for the coming year, largely towards retail expansion and partly for improving manufacturing.

“We had a capex of about ₹3,294 crore last year, and we are planning to step that up to around ₹5,200–5,300 crore in the coming financial year,” Asher said during a media interaction in Delhi on March 24.

Commenting on ongoing geopolitical tensions in the Middle East, Asher said that the conflict has triggered sharp volatility in gold prices, impacting consumer behaviour. “Customers are confused by gold price fluctuations, which is influencing their purchase timing,” he said.

While wedding-related demand remains resilient, discretionary buying has taken a hit. “Wedding buying continues to remain strong because it cannot be postponed, but discretionary purchases are seeing delays amid uncertainty,” he explained.

The company, however, remains cautiously optimistic. “It is too early to quantify the exact impact of the war, but we are clearly seeing a shift in buying behaviour,” Asher added.

To navigate the uncertain environment, Malabar Gold is recalibrating its product strategy, focusing on design-led affordability rather than relying solely on lower purity offerings.

“Through design optimisation and manufacturing efficiencies, we are able to offer jewellery that looks similar but costs 15-20% less,” Asher said.

At the same time, the company is witnessing a shift in product mix, with 18-carat jewellery gaining traction due to its affordability and appeal among younger consumers.

₹200 crore CSR outlay for FY27

Alongside its growth push, the company has announced corporate social responsibility (CSR) initiatives worth ₹200 crore for FY27, to be implemented across more than 3,000 locations in 19 states, covering 15 major programmes and expected to benefit over 2 lakh people.

“Human resource development is the backbone of national growth. Nurturing talent through quality education is essential, and our scholarship programmes enable students to achieve academic success and contribute to the country’s development,” said M. P. Ahammad, Chairman, Malabar Group.

He added that the group remains committed to creating sustainable, long-term societal impact through continued investments in CSR.

A significant portion of the CSR spend, ₹114 crore, has been allocated to education initiatives, including micro-learning centres for street children and national scholarship programmes for girls.