Price fall prompts consumers to rush for new bookings.
A marginal price correction in precious metals brought cheer for bullion lovers on the occasion of Akshaya Tritiya, the year’s most auspicious occasion to buy gold.
Gold demand is estimated to rise a minimum 15 per cent on this day to surpass 50 tonnes this year as compared to 45 tonnes last year, said Ajay Mitra, managing director, Indian sub-continent, World Gold Council (WGC).
Supporting his view, Prithviraj Kothari, director of the country’s largest bullion dealer, RiddiSiddhi Bullions (RBL) said, “In value terms, 25-30 per cent growth is estimated, while in volume terms it could be 15 per cent.” Kothari factored in the price rise since the last Akshaya Tritiya (May 16, 2010). Gold jumped 19 per cent in the last one year to Rs 21,685 per 10g, while silver shot up a phenomenal 81 per cent to Rs 54,305 a kg.
After hitting a high of Rs 22,710 per 10g on April 30, gold plunged 4.51 per cent to Rs 21,685 per 10g, providing a breather to spot buyers. Similarly, silver dived 27.6 per cent from its peak of Rs 75,020 a kg on April 24 to Rs 54,305 a kg. The yellow metal recorded a decline of Rs 220 per 10g while the white metal fell by Rs 4,350 a kg on Friday.
Consumers are booking afresh, assuming that prices may move northward, said Ketan Shroff, director of the city-based Pushpak Bullions.
Jewellers across the country had started booking over a week ago for deliveries on Friday. Consumers who booked in advance, however, suffered a major loss of Rs 1,010 per 10g. Kothari pointed out that consumers hardly think about prices on this day. The price fall helped new consumers who were awaiting a correction for buying, he added.
Gold exchange-traded funds (ETFs) recorded a total volume of 1.5 tonnes by early evening.
RBL recorded 250 kg of gold and 2,100 kg of silver sales on Friday, a growth of 20 per cent from the previous year.
Ashok Minawala, past chairman of the Gems and Jewellery Trade Federation, however, said despite the fall, precious metals were traded higher. Hence, most of lower middle class consumers would not find gold affordable.
Suresh Hundia, the largest silver importer in India, feels Akshaya Tritiya is celebrated primarily with gold buying. Only those consumers who cannot afford gold buy silver. Hence, silver sales in value terms are never high on this occasion, he added.
E-gold sales on the Financial Technologies-promoted National Spot Exchange (NSEL) are expected to touch Rs 250 crore and e-silver sales at Rs 450 crore. Total gold holding under e-gold contracts has, therefore, surged to 89 tonnes in one year after the contract was launched on the last Akshaya Tritiya, said Anjani Sinha, managing director of NSEL.
