Gold & Silver

Banks sell more gold coins, jewellers' sales dip

Our Bureau Chennai/Bangalore | Updated on November 14, 2017 Published on May 06, 2011

Akshaya Trithaya


First reports suggest a mixed trend in gold sales this Akshaya Tritiya. While banks reported higher sales of gold coins compared with last year, jewellery stores in Chennai reported lower sales volume.

Indian Overseas Bank (IOB), Andhra Bank and Indian Bank reported robust demand for gold coins. IOB sold 300 kg of gold in the last two days. Yesterday alone, it sold 103 kg of gold, according to Ms Renuka Mohan Rao, General Manager, IOB.

Andhra Bank reported sales of 100 kg compared to 75 kg last year while Indian Bank sold 250 kg over the last four days, which is higher than the 206 kg it sold last Akshaya Tritiya. Banks sell Swiss-made 99.9 per cent pure cold coins in 2,4,8,20,50 and 100 grams sealed packages.

But there was a mixed response from gold jewellery retailers in Chennai's T. Nagar shopping district which has around 25 large format stores and over a hundred small shops selling gold jewellery in a half-km radius. These shops together sell 1.5-2 tonnes of gold every year during Askhaya Tritiya.

Jewellery shop owners said that while sales in value terms were higher, volumes were low.

“It's slightly disappointing that despite Akshaya Trithiya being spread over two days and gold price lower than yesterday by Rs 29 a gram, sales are lower,” said a senior executive of one of the leading jewellery stores in this stretch. He estimates that the footfalls were 30 per cent lower this year. And the cop on the street outside confirms: “The entire stretch was choc-a-block by this time last year.”

Mr L. K. S. Syed Ahmed, Chief Advisor, Tamil Nadu Jewellers Federation and Chairman of LKS Gold House, says he saw a 25-30 per cent drop in sales sales this year. He attributed this partially to the fact that earlier people from down South came to Chennai for jewellery purchase. But in the last two years, many of the leading jewellery retail brands have opened stores in several Southern districts.

Mr Bhuwan Gaurav, Head of Marketing, Tanishq, said: Our Bangalore stores have been seeing a fluctuation in footfalls. The signs are good. We expect more traffic once the offices close.”

According to him, North and West markets are also doing well. “Overall, we expect a 30 per cent increase in sales over last year's season,” he said.

Mr K. Shivram, Vice-President, World Gold Council, says the true picture will emerge only by tomorrow.

“The first day has not seen people pouring in like last year. But we expect a sales increase (in value) of 15 per cent over last year's Akshaya Tritiya,” he said.

He says the demand for coins sold by banks is greater as it comes in sealed packages. Moreover people prefer to buy gold coins as they can convert it to jewellery whenever they want. They can also pledge the gold coins with banks for loans.

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Published on May 06, 2011
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