Gold sales picked up pace this Dhanteras, considered auspicious for purchases of the precious metal, marking the beginning of a recovery in gold demand in 2016 after two straight quarters of plunge. By 7.30 pm, some of the big jewellers in Delhi and Mumbai that FE spoke to witnessed up to 40% rise in footfalls and a 25-30% jump in sales from a year before. However, as was anticipated, the sales of small jewellers, who account for the largest chunk of the country’s gold demand, witnessed only modest rise, some of them said.
Somasundaram PR, managing director (India) of the World Gold Council, said: “Consumers who have been deferring gold purchases are back and the demand for gold jewellery and branded coins seems to be much better than the previous year’s Dhanteras and Diwali festival.”
However, the good sales may not be enough to offset the massive plunge in gold demand in the first half. Somasundaram said demand could still be in the lower side of the 750-850-tonne range in 2016, compared with 863 tonne in 2015. This is because Indian demand volume already dropped a massive 29.6% in the first half of 2016 from a year before to just 247.4 tonne.
Nevertheless, good monsoons and a softening of gold prices since the beginning of this month (around 3%) have definitely improved the sentiment around this traditional asset class and the wedding season ahead appears promising for the trade and consumers alike, Somasundaram said.
Kalyan Jewellers — the country’s second-biggest player — recorded “very good” and a “double-digit” rise in sales at its outlets. Popley Group’s director estimated 25% rise in sales. Waman Hari Pethe Jewellers has witnessed a 15% rise in sales on Dhanteras, according to its director Aditya Pethe.
Rajesh Tulsian, co-founder of Dwarkadas Chandumal Jewellers, said his company has recorded a 25% rise in sales so far from the level seen during last Dhanteras, partly aided by greater demand from NRI clients this year. However, some of the smaller neighbourhood jewellers, especially in Delhi’s Channdi Chowk and also in Mumbai, saw muted growth in sales.
Also, coins staged a comeback after lukewarm response in recent years. The sovereign gold coin, introduced by Prime Minister Narendra Modi on November 5, witnessed better sales this year. The coins were available at 383 outlets across the country. Apart from all MMTC outlets, the India Gold Coin was sold at select branches of seven banks, Indian Overseas Bank, Vijaya Bank, Federal Bank, Yes Bank, Andhra Bank, ICICI Bank and HDFC Bank.