Gold sales pick up in Vizag

After a gap of two months, yellow metal sales are slowly picking up in Visakhapatnam. The business in city shops during the last two months remained sluggish with sales dropping by 70-80 per cent due to abnormal increase in gold prices.

Since August, gold prices had touched the sky at Rs 8,100 for 10 gm bringing down the sales by as much as 30 per cent.

Even the marriage season could not reverse the trend, Ranjit Kumar, secretary, Visakhapatnam Gold and Silver Jewellery Merchants Association, told Business Standard. Even during the wedding season, customers put off their plans to buy gold anticipating a fall in prices soon.

As a result, most of the jewellery shops here reported a sharp fall in their sales, he added.

However, with rumours in the air that gold prices might touch the Rs 10,000-mark in the coming days and with lots of weddings scheduled to take place, customers have started flocking to gold shops.

"For the past few days, our sales have increased 40 per cent due to the rumours. We are expecting a further rise in sales in the coming days," Majendra Jain, managing partner, Hira Panna Jewellers, told Business Standard.

There are about 350 gold jewellery shops in the city. While the daily turnover of 25 shops ranges between Rs 1.5 lakh and Rs 7 lakh, 40 of them do business worth between Rs 50,000 and Rs 1.5 lakh. The rest of the shops are mostly smaller ones with a turnover of Rs 15,000-Rs 50,000.

Of late, many leading jewellers have set up shops here and are attracting customers even from the neighbouring state of Orissa. According to gold merchants, the total turnover of ornaments in the city is about Rs 2 crore a day.

Another section that is hit hard by prohibitive gold prices are local goldsmiths whose earnings have fallen by 50 per cent. There are about 1,000 goldsmiths eking out a living by working for jewellery shops. Availability of readymade ornaments has already hit the income source of most of them. Now, the soaring gold prices has further worsened their condition.