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Stable gold prices and a huge pent up demand are likely to augur well for jewellers this year as sales are expected to surpass the pre-pandemic levels. Jewellers are looking to cash in on the bullish sentiments of customers with attractive offers and schemes ahead of Diwali.
After a stellar rally last year, gold prices have remained largely range-bound this year. They are now hovering around ₹44,500-45,000 per 10 gm. Though prices are some 6 per cent lower compared with ₹48,000 per 10 gm during the same period last year, they are almost 29 per cent higher than ₹34,000-35,000 per 10 gm recorded in 2019.
Demand surge
The growth will not only be driven by increased ticket size of transactions but also volumes, industry experts said.
According to Ajoy Chawla, CEO, Jewellery Division, Titan Company Ltd, there has been a demand resurgence and the company’s jewellery division has registered a 77 per cent growth in income at ₹6,106 crore in the second quarter of the current fiscal against ₹3,446 crore in the same period last year (excluding bullion sale in both the periods).
“In the second quarter of this year, there was close to70 per cent retail growth over last year and, over pre-pandemic levels, we have grown by around 61 per cent in value terms. Some amount of deferred demand will kick in (during the coming quarters),” Chawla told BusinessLine .
“Pent-up demand, softening of gold prices and good monsoon along with easing of lockdown restrictions across the country bode well for a surge in demand. Anecdotal feedback from the jewellery retailers reflects this sentiment strongly this Dhanteras,” said Somasundaram PR, Regional CEO (India), World Gold Council.
There has been a growth in absolute grammage after nearly two years.
Higher sales
“Two years ago, when gold prices spiked up, sale of the yellow metal in grammage terms declined. Now, that has come back because gold prices are relatively stable,” he said.
Kolkata-based Senco Gold and Diamonds saw a 30-35 per cent growth in sales this year compared with last year. Sales are up by 10-15 per cent over 2019 numbers, said Suvankar Sen, CEO.
HK Jewels, which manufactures diamond-studded gold jewellery under the brand name Kisna, booked orders for 33 per cent more gold this October over the same month last year.
With inputs from
Mumbai Bureau
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