Chennai: The confluence of stable prices, upcoming wedding season and pent-up demand made this Akshaya Tritiya memorable for the gold and jewellery sector, which saw demand bouncing back after a gap of two years. Jewellers across the country witnessed on an average 15 to 20 per cent growth in sales over last year.
Northern markets found Akshaya Tritiya an occasion to initiate wedding jewellery purchases, while south and west went ahead with token purchases in deference to the auspicious day. Investment demand too was better than last year.
“We saw sales up by 10 to 15 per cent compared to last year. Due to the long wedding season, this year the gold and jewellery sales have been pleasing on Akshaya Tritiya,” said Anantha Padmanabhan, Chairman, All-India Gems and Jewellery Domestic Council (GJC).
According to Somasundaram P R, managing director, India, World Gold Council, pent-up demand in the market has supported Akshaya Tritiya sales. “The fabrication of gold has been consistently ahead of demand for the past nine quarters, barring Q4 2018. Fabrication is 169 tonnes more than the retail demand and this made jewellers off-load their excess stocks with offers and promotional activities,” he said.
Retailers like Malabar Gold and Diamonds were offering as much as 50 per cent off on jewellery-making charges whileTanishq was giving a discount of up to 25 per cent. Kalyan Jewellers was giving away gold coins free with purchases. Discounts coupled with a drop in prices from the recent high in February made the day more auspicious for buyers.
Gold was trading at Rs 31,240 per 10 gram on commodity exchange MCX. Prices were 8.2 per cent down from a 2019 high of Rs 34,031 in February. Moreover, the prices have been stable around these levels for the past few days. Consumers were seen placing advance orders for gold to take delivery of gold jewellery on Akshaya Tritiya to make the most of the decline in international gold prices.
The organised jewellers were better positioned to grab Akshaya Tritiya sales as the market has been shifting in their favour since demonetisation and GST. Sandeep Kulhalli, Senior Vice President-Retail and Marketing of Tanishq found a healthy double-digit growth compared to last year.
T S Kalyanaraman, Chairman and Managing Director of Kalyan Jewellers, said stable prices and positive consumer sentiments helped the sales. “There are many more auspicious wedding dates in 2019 as opposed to last year. Families prefer to initiate their wedding purchases on Akshaya Tritiya, so we have also got traction with our wedding line as well. In the metros, we are seeing an increase in the number of young, first-time buyers making token purchases. In the non-metros the sentiment continues to be positive,” he said.
Digital gold platforms, though niche and small, saw significant investment demand. "The demand exceeded five times more than regular sales. This year, we saw a lot of young individuals opting for gold coins and bars over jewellery for investment purposes,” said Sachin Kothari, Director, Augmont, an online platform.
By estimates, at least a third of the second quarter sales happen during the week leading to Akshaya Tritiya. “According to various estimates published by research agencies and associations, total volumes are estimated around 40 to 50 tonnes. In seven out of the last 10 years, if one had bought gold on the day of Akshaya Tritiya the returns were positive. Indians following the Hindu religion spend over $2 billion in a single day,’ said Sudheesh Nambiath, Head-India Gold Policy Centre at IIM-Ahmedabad.
