KOLKATA: MUMBAI: Gold buyers in India flocked to jewellery stores on Akshaya Tritiya, shrugging off an uptick in price to give merchants a good start to the Hindu festival considered auspicious for buying bullion. Although prices had inched up by 0.69% during trade, jewellers witnessed good demand, with customers preferring organised jewellers over the unorganised ones.
Traders said demand for gold jewellery , coins and bars increased by 10-15%. A Pune-based jeweller said sales increased by as much as 35% at some of its stores. On Friday , gold prices were hovering around ` . 28,900 per 10 gm, down 3.68% from the level during the last Akshaya Tritiya festival, when it had touched ` . 30,000 per 10 gm. The comparatively lower rate and positive outlook on gold helped spur demand, traders said.
World Gold Council managing director (India) Somasundaram PR said that even though international prices have gone up by 8.5% since the beginning of this year, domestic prices have gone up by only 2.5%, as the rupee has strengthened against dollar, minimising the impact of global price rise.
“The sentiment is positive in the market and the woes of demonetisation are over, which has boosted sales. Gold price has remained stable for the last few weeks, which has sent strong signals to buyers,“ Somasundaram PR said.
Jewellers said a robust stock market has also impacted sales this time.TS Kalyanaraman, chairman of Kalyan Jewellers, said, “We are expecting 10-15% growth in revenues during this Akshaya Tritiya compared to last year, based on present trend of purchases. This has been driven by positive consumer sentiments and demand recovery . A buoyant stock market supported by global fundamentals has also resulted in increased deployment to jewellery“.
Saurabh Gadgil, managing director of Pune-based PNG Jewellers, said fears that the rollout of goods and services tax (GST) could make gold costlier has brought a lot of people out to purchase gold. He said all his outlets, whether in urban area or in rural parts of Maharashtra, witnessed 30-35% growth in demand.
“Akshaya Tritiya sales may spill over to Saturday also,“ he said.
Jewellers in price-sensitive eastern India witnessed good sales too.Suvankar Sen, managing director of Senco Gold & Diamonds, said, “We have witnessed a 15-20% growth in demand. What is interesting is that customers who earlier used to go to neighbouring unorganised shops have shifted to organised ones“.
However, amid upbeat sentiments, there is con cern in the market over the sharp jump in imports for Akshaya Triti ya. Rajesh Khosla, managing director of MMTC-Pamp, estima tes that imports in April this year have topped 70 tonnes, the highest since 2013. “Demand for gold is high, which is why the surge in imports this Akshaya Tritiya,“ said Khosla. “I don't think the day's far when the government would have to think how to manage gold imports.“
MMTC-Pamp pegs average monthly imports at 40-50 tonnes.
In 2013, gold imports had touched 120 tonnes, prompting the government to increase import duty and institute the 20:30 scheme to restrict imports, which caused the rupee to plummet that year. The Reserve Bank withdrew the 20:80 scheme in November 2014. The jump in gold imports was attested to by jewellers who said sales on this occasion would be way above that of last year an abnormal one as many jewellers had struck work because of introduction of excise duty , causing imports in April of last year to be less than 20% and leading to a jump in smuggling.
Source: The Economic Times