MMTC and Indian Potash Ltd (IPL) have forged a ‘flagship venture' to popularise MMTC's brands of gold and silver, both jewellery and medallions, across the country's semi-urban and rural markets in the wake of robust consumers' preferences for purity of bullions in rural areas.

At a function to launch ‘IPL Swarnalaya' showroom to showcase MMTC's range of precious-metals retail products that include hallmarked gold jewellery, gold and silver medallions as well as its brand of Sanchi silverware in 92.5 per cent purity, the IPL Chairman, Mr Govindan Nair, said that “when we decided to diversify into gold jewellery, we decided that [tying up with] MMTC, our old partner, would be the ideal method” for reaching to the target clientele in rural areas in view of its vast marketing arm.

Cooperative network

Supplementing Mr Nair's observation, the IPL Managing Director, Dr P.S. Gahlaut, said as the rural economy has been buoyed up by record harvest of grains during the past three to four years, they “saw after high demand for consumer items, there is also a demand for a little more expensive items like gold” in the rural market not only from households but also from small investors. As most of the farmers and small investors with whom IPL interacted were not sure of the purity of the gold/silver they buy, IPL thought of entering into an alliance with MMTC to sell its brand of hallmarked jewellery and silverware across the remote rural areas, he added.

Dr Gahlaut said IPL intends to use its cooperative network of fertiliser dealers across the rural and semi-urban areas to sell MMTC jewellery items and to start with, the company has opened the ‘IPL Swarnalaya' showroom of MMTC Jewels here. This would be followed by more such showrooms in Patna, Lucknow, Bhopal and Jaipur before the end of the calendar year.

The idea was, he said, that these showrooms would be set up in State capital initially and after considerable experience would be replicated down to the district headquarters, since the ‘visibility' factor would be a problem if such showrooms were put up in the rural areas first. He hoped, “All the dealers of IPL who would be visiting our showrooms would be able to transfer the confidence of quality and fair price of MMTC products to the rural clientele.”

MMTC, Director (Precious Metals), Mr Ved Prakash, said the company's endeavour was to supply 100 per cent hallmarked jewellery with exclusive design from all regions of the country so that customers would get the twin benefits of variety and purity. He said MMTC was also moving fast to develop its own brand of jewellery.

More retail outlets

He said the company has declared 2011-12 as the year of retail and hence, plans to augment the retail outlet numbers across the country to 125 by 2012 from 15 showrooms with 75 stockists/outlets. He said gold had given the maximum return of 20 per cent in the past five years, becoming “the best investment option for small investors”.

Mr Prakash said the company last year imported 245 tonnes of gold against 186.87 tonnes in 2009-10. He said the company plans to heighten its brand image as supplier of quality of gold/silver retail products at competitive prices through exhibitions in various cities. Major tourist festivals would be tapped by the company to enhance overall retail sales this fiscal to around Rs 650 crore, he said, adding that MMTC's Festival of Gold exhibition is planned in the Capital from October 16 to 24

He said the company plans to set up a separate retail division for procurement, fabrication and marketing of jewellery and silverware that would also look after inventory control. He hoped that after the alliance with IPL gets going to capture rural demand for jewellery items and medallions, MMTC has plans to sell its bullion products through post offices to help small investors to take interest in medallions for investment purposes.

> geeyes@thehindu.co.in

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