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Gold sales fail to shine this Diwali season
It’s real. There were no Deepawali fireworks at gold showrooms and shops in the City of Pearls as sales of yellow metal plunged to historic lows during the festive season.
Hyderabad: It's real. There were no Deepawali fireworks at gold showrooms and shops in the City of Pearls as sales of yellow metal plunged to historic lows during the festive season.
On an average, sales were down by as much as 30 per cent during this Dhanteras-Diwali, but some jewellers suffered steeper decline in sales.
However, jewellers say high gold price helped them balance the sales dynamic as the total value of sales remained high despite low sales volumes.
"Compared to last festive period, sales volume of gold jewellery has been down by 25-30 per cent. The gold price has gone up by 20 per cent this time when compared to last year's price.
That way, the value of total sales is higher though volume is low," Gopi Krishna, Managing Director, Manepally Jewellers, told The Hans India.
Jewellery retailers recalled that the demonetisation of high-value currency notes carried out in November 2016 hit jewellery segment hard and the sector is yet to recover from that shock.
Adding fuel to the fire, GST, enhanced import duty also took a toll on the yellow metal. Further, gold (24 carat) prices were close to Rs 39,600 per 10 grams this year against Rs 32,000 a year ago, dampening sales.
"Last Dhanteras, we had around 400 bookings, but this year the number came down to 44. Earlier, we would see sales for two days when Dhanteras would start in the afternoon to end the next day afternoon.
But, this trend of buying has reduced limiting it to only a day,"
Pavan Mor, owner of Pavan Mor Jewellers said.
Unlike in the past, light weight jewellery like pendants and gold coin were in demand, accounting for 50-60 per cent total sales this Diwali. Diamond and other stone-studded jewellery made up the rest.
While party jewellery priced below Rs 3 lakh and pendants engraved with goddess Lakshmi were the hit of this season. For this Dhanteras, Manepally Jewellers introduced gold coin that weighs just 1 gram. This saw record sales.
"Deepawali is the gold festival of India. To fit into customers budget, we came with light weight jewellery by utilising less gold. The jewellery which would usually be made in 100 gram has been made in 80 gram.
Antique jewellery for party wear and weddings in the form of necklace is now available from a price range of Rs 1.50 lakh and diamond jewellery in the form of necklace is priced Rs 3 lakh and above," explained Manepally's Gopi Krishna.
However, jewellers pinned hopes on upcoming wedding period for which the bookings have already started. "Wedding jewellery shopping is done in volumes.
This is the best part. Also, there is no off-season in between as jewellery for weddings are booked at least three months in advance, keeping the sale cycle upbeat. These buyers tend to book the gold rate while at its low and select the jewellery design later," Pavan Mor said.
Adding further, Krishna said that the customers who were on wait and watch for the last three to four months period, with the gold price at its all-time high, are now out to shop for weddings, as the news about gold reaching nearly Rs 50,000 has spread like a wildfire.