Jewellery stocks plunged up to 6 per cent in Wednesday's trade, following a hike in customs duty on gold and silver to 15 per cent from 6 per cent earlier, taking their losing run to the third session. The fall was led by Kalyan Jewellers India Ltd, Senco Gold Ltd and Thangamayil Jewellery Ltd, as the government upped import tariffs on gold and silver to 15 per cent from 6 per cent. Titan Company Ltd and a few other jewellery stocks were trading flat after the recent fall, as investors judged recent selloff as excessive. 

Kalyan Jewellers India Ltd saw its shares falling 5.62 per cent to Rs 341.45 on NSE. Thangamayil Jewellery declined 2.43 per cent to Rs 3,580.70. Senco Gold fell 1.6 per cent to Rs 307.80. PN Gadgil Jewellers was trading 1 per cent lower at Rs 620.95. Titan Company fell to a low of Rs 4,001. It recovered and was later trading flat at Rs 4,052.90. PN Gadgil Jewellers and Tribhovandas Bhimji Zaveri were flat.

Jewellery stocks had been falling this week, as the market was fearing certain taxation measures on gold, Kotak Institutional Equities said. Now, the government has imposed a ⁠10 per cent basic customs duty and a 5 per cent Agriculture Infrastructure and Development Cess (AIDC) on gold and ​silver imports. This has resulted in revision in effective import tax to 15 per cent from 6 per cent earlier. 
The move was in line with Street anticipation. Nomura had earlier suggested that the government may disincentivise non-essential imports like gold, and may include a potential hike to the customs duty on gold imports. It had, however, noted that gold shipments have been stuck at customs since March, owing to administrative delays.

The fresh move comes after the Prime Minister Narendra Modi’s earlier this week urged households to avoid buying gold jewellery for one year. PM Modi's appeal was seen as reduced policy appetite for further worsening of twin deficits, which triggered sharp market fall in the broader market in past two sessions.