Jewellers expect to clock 70 pc of last year’s business

Jewellers are expecting a revival in retail sales this festive season as the yellow metal has always been an integral part to festivals in India

Mumbai: Jewellers are betting on recovery and are optimistic that a rebound in the economy and pent up demand will help boost sales during this ‘Dhanteras’ and the industry is likely to do up to 70 per cent of last year’s business.

Notwithstanding the ruling high gold prices and ongoing Covid-19 uncertainties, jewellers are expecting a revival in retail sales this festive season as the yellow metal has always been an integral part to festivals in India, particularly so during Dhanteras, Diwali, and the ensuing wedding season.

“There has been a gradual growth in both footfalls and sales since the beginning of the festive season which has grown even more since the last few days despite the ongoing uncertainties over Covid-19. This has made us hopeful that we will be able to do 70 per cent of last year’s business during Dhanteras,” All India Gems and Jewellery Domestic Council (GJF) chairman Anantha Padmanabhan said. Gold prices have been ruling in the range of Rs 52,000 per 10 grams in the country.

“Millions of Indians believe that purchasing gold during the auspicious occasion of Dhanteras will usher in good fortune and wealth. Reflecting this sentiment, this year, Dhanteras is likely to mark the onset of a modest buying period, providing some respite after a prolonged phase of suppressed demand and subdued activity due to the current pandemic,” World Gold Council MD, India, Somasundaram PR said.

Digital gold providers like SafeGold, Augmont and MMTC-PAMP and other online platforms could find this period very conducive for increasing volumes and for broadening the consumer base, he said adding that “the higher savings following drop in consumption expenditure of many households as a result of lockdown could flow to gold.”

According to CapitalVia Global Research product manager, commodities, Kshitij Purohit, the US dollar remains a crucial driver for the precious metal going forward. In anticipation of festive demand, gold has taken a new stage in Indian markets and in August it showed a month-on-month gain of 107 per cent, he said adding that focusing on the current data, it is unlikely to cool off the prices of gold, despite being the continuing pandemic.

“Technically, MCX Gold December has jumped above Rs 52,000 per 10 grams, where it holds a strong support at Rs 51,200. All uncertainty due to Covid-19 and festive demand from the India gold price will remain firm. We are also expecting follow up buying due to marriage season also,” he added.