It was a sparkling Wednesday for jewelry showrooms in Chennai and Mumbai, which saw heavy footfall on Akshaya Tritiya – the day when Hindus and Jains buy gold or other assets as it is considered auspicious.
A public holiday due to Eid and pent-up demand after two years of the pandemic boosted sales. Jayanthi Lal Challani of Challani Jewelery and President of Chennai Jewelers and Diamond Traders Association said, “Sales have increased by almost 25% compared to 2019. This year, demand for antique jewelry and temple was good.
Aditya Pethe, director of WHP Jewelers, said sales this year during Akshya Tritiya are expected to be at least 25-30% higher than in pre-pandemic years. N Anantha Padmanaban of NAC Jewelers went so far as to say that sales were almost 35% higher than in 2019.
Somasundaram PR, Regional CEO – India, World Gold Council, said after two lackluster years, the festive sentiment among traders and consumers appeared to be strong this year. Sustained aggressive marketing and trade promotions also helped.
Digital gold-buying platforms were also bullish, with retail buyers enthusiastically picking up the convenience of buying gold for as little as one rupee on their smartphones, he said.
Help with reductions
Despite gold prices hovering around ₹50,000 per 10 grams, there was still “increased interest” among consumers in buying the metal. According to Somasundaram, this could be due to the perceived risks posed by inflation and global uncertainties caused by Ukraine’s war against other asset classes.
Ramesh Kalyanaraman, Executive Director of Kalyan Jewellers, said: “The higher pull of this Akshaya Tritiya could be due to the lower volatility in gold prices over the past week and the festival holiday due to Ramzan . While an increase in sales in southern markets was expected, the response from non-southern markets has also been extremely encouraging,” he said.
Suvankar Sen, MD and CEO of Senco Gold and Diamonds, said sales improved in bridal jewelry and light collections in addition to traditional gold bars and coins. Silver utensils also had a good impact on sales.
“We also offer discounts to encourage our customers. Customers can also visit our e-commerce site and purchase jewelry via virtual connection and their desired products will be delivered to the given address,” Sen said.
Shrey Mehta, Director of Pooja Diamonds, said: “As we specialize in bridal jewelry, we are seeing much higher footfall for brides who take delivery of their bridal jewelry as it is an auspicious day, so for brides to place orders and collect a symbolic piece of jewelry.He said retail has revived as expected, at least in the bridal space despite speculation during the pandemic that online could evolve as a channel for dominant purchase.
Pritam Patnaik, Head of Commodities, Axis Securities, said Akshaya Tritiya could have been the perfect time for investors looking for a window of opportunity to start investing in gold.
Prices under pressure
Gold prices are under pressure as the US Federal Reserve looks all but certain to approve a 50 basis point rate hike at its May policy meeting on Wednesday, the biggest hike in more than two decades.
“We can consider investing part of their allocation during the auspicious date and then allocate the balance as prices fall, which will be around the Fed’s key rate announcement dates. A laddered approach to investing is the most prudent course for gold,” Patnaik said.
May 03, 2022