We use hydrodynamics to investigate clustering in a gas of inelastically colliding spheres. The hydrodynamic equations exhibit a finite-time density blowup, where the gas pressure remains finite. The density blowup signals the formation of close-packed clusters. The blowup dynamics is universal and describable by exact analytic solutions continuable beyond the blowup time. These solutions show that dilute hydrodynamic equations yield a powerful effective description of a granular gas flow with close-packed clusters, described as finite-mass pointlike singularities of the density. This description is similar in spirit to the description of shocks in ordinary ideal gas dynamics.