Silver has quietly outpaced gold in recent months, hitting a record ₹1.01 lakh per kilogram, or ₹10,100/10 grams.
Its dual identity—as both a precious and industrial metal—is powering this run, and analysts believe it could deliver stronger returns than gold in the coming quarters.
Silver’s moment may have just begun
“Silver has always played the underdog to gold, but that’s changing,” said Satish Dondapati, Fund Manager at Kotak Mahindra AMC. “Its industrial use in solar panels, electric vehicles, and electronics is exploding. Combine that with monetary demand, and you’ve got a recipe for outperformance.”
Dondapati points to silver’s 34% rise in 2024, which beat gold’s 26% jump.
A similar pattern occurred in 2020, when silver surged 63% during the pandemic, eclipsing gold’s gains.
Supply crunch, surging demand
The silver market has been in a supply deficit for four consecutive years.
Just in 2024, there was a shortfall of over 200 million ounces, or nearly 5,670 tonnes—the largest in recent memory, according to the Silver Institute.
This imbalance is only expected to deepen.
Industrial demand could exceed 700 million ounces (19,845 tonnes) in 2025, fueled by the clean energy push and booming tech sectors like AI and semiconductors.
“Silver’s unmatched conductivity makes it crucial for high-performance devices,” said Dondapati. “That demand isn’t slowing anytime soon.”
Macro tailwinds for silver
Monetary factors also favour silver. Lower interest rates, inflationary concerns, and a weaker dollar support precious metals.
While gold stands to benefit from these factors too, silver’s lower price and industrial use give it an edge.
Kunal Shah, Head of Commodities at Nirmal Bang, believes gold has run ahead of fundamentals and may be due for a correction.
“We expect a drop of $100–$250 per ounce soon,” he said, predicting gold could slide to $2,800 per ounce.
Shah advises investors to book profits in gold and rotate into silver. “Silver is still undervalued. We see a 10-15% upside in the next six to seven months.”
Gold-silver ratio signals opportunity
The gold-silver ratio (GSR)—which measures how many ounces of silver it takes to buy one ounce of gold—remains high, at around 89.
Historically, a lower GSR has followed major monetary interventions, such as during the 2008 crisis and the 2020 pandemic.
“A high GSR signals that silver is cheap relative to gold,” said Dondapati. “If history repeats, silver could see a sharp catch-up rally.”
A global divergence
Juerg Kiener of Swiss Asia Capital notes a mismatch in silver demand between East and West. “
Silver is trading in a wide range—$30 to $50 an ounce is a great entry zone,” he told CNBC-TV18.
He expects gold to correct before heading to $3,500 per ounce by July and even touch $8,000 per ounce in five years.
But in the short term, silver could offer more bang for the buck, experts say.