Dru Gold recycling model to check imports
The company has invested Rs 2.5 crore already and will be investing another Rs 2.5-3 crore in further expansion
Hyderabad: Hyderabad-based Dru Gold, which has set up stores in Hyderabad to deal with gold scrap and recycling, is looking to expand to other districts of Telangana and other neighbouring States from 2021 onwards.
In the next six months, the company plans to add 20 new stores. The company aims to reduce India’s gold imports through its business model The company has invested Rs 2.5 crore already and will be investing another Rs 2.5-3 crore in further expansion. Initial funding will be through internal accruals, but for pan-India scale up, the company plans to approach venture capitalists for funding. Dru Gold plans to have 70 per cent store network in tier-2 and tier-3 cities, and the remaining 30 per cent in metros.
Talking about the plans, Dru Gold founder Akhilesh Agarwal said, “We are operating 14 stores in Hyderabad and plan to open more in the coming months. Subsequently, we plan to expand into the international markets in the next two years. Thailand, Burma, Sri Lanka and China are potential markets for us. To meet our growth needs, we will raise funds towards the end of 2021.”
“In the gold recycling sector, 80 per cent of the activity is dealt with cash, which is illegal. We are changing this. We value the gold, melt and test it, bringing in complete transparency to customers, which is lacking currently in the conventional sector. People are cutting corners when it comes to testing quality and calculating the real value of gold that the customer is bringing.”
Explaining how the process works, Agarwal said, when a customer comes to the store, Dru Gold staff weigh the gold and give proper estimation to the customer. Once the customer accepts the value, the gold is melted, weighed and the value of the gold is sent to the customer’s bank account.
In the back-end, Dru Gold will refine the gold further to 24 carat gold and convert into bullion bars to supply them to the bullion market, which bullion traders further supply to the jewelers.
“The company aims to ensure transparency in the market which is controlled by the unorganised sector, and support the Make in India initiative to curb the imports. Our stores will help utilise the gold that is just lying idle with customers. This gold will be recycled and used. India doesn’t have to spend its resources on import of gold,” he added.
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