Hallmarked gold coins, bars see 35-80% sales surge on the e-commerce platforms
Tue Sep 24 2024
Hallmarked gold coins and bars of 22K and 24K are getting a boost from India’s thriving ecommerce industry, with sales surging 35-80% in the last financial year.
To be sure, the sales spurt across online marketplaces such as Amazon, Flipkart, Ajio and Tata Cliq is on a low base, but it marks a shift in customer preference for a category traditionally dominated by retail stores, said industry executives.
Malabar Gold & Diamonds, Kalyan Jewellers, MMTC-PAMP and Joy Alukkas are among jewellers selling 22K and 24K gold coins and bars, between 1 gm and 10 gm, on online platforms. A similar trend is expected in lightweight gold jewellery, according to the executives.
“Amazon is seeing 84% year-on-year spike in hallmarked gold jewellery from brands such as Malabar Gold & Diamonds, PN Gadgil Jewellers, Joyalukkas, PC Chandra and KISNA, among others,” said Zeba Khan, director, fashion and beauty, Amazon.
Executives said they are adding inventory on these platforms to meet an expected rush of demand this festive season, especially during Dhanteras and Diwali. Amazon is also selling lab-grown diamond jewellery, said Khan.
Investment demand for gold in the form of bars and coins is also on the rise due to prevailing higher prices. Gold was trading at Rs 76,768 per 10 gm on Monday.
Sachin Jain, regional chief executive, India of World Gold Council said in the June quarter, sales of bars and coins rose 46% by volume to 45 tonnes, and 75% by value.
“We are expecting much better performance in Q3 and Q4 as well. The geopolitical tension, interest rate cut by the Federal Reserve and the uncertainty in the global economy are unlikely to bring down the investment demand for gold in the near term,” Jain said.
Kerala-based Muthoot Pappachan Group, which sells gold coins and bars through its own online platform and e-tailers like Amazon and Coin Bazaar, is expecting robust sales this festive season.
“We have seen 25-30% growth in online sales in FY25 as compared to the same period in FY24, including the sales via our retail network. We are bullish for this festive season, which has just started and prices of gold after dipping on account of the reduction in customs duty, is now again going up. It vindicates the belief of mass Indians in gold as a time-tested asset class that helps preserve the value of their savings-investments as well as creates more wealth in the long term,” said Keyur Shah, CEO of Precious Metals Business at Muthoot Pappachan Group.
Many are buying 24K gold coins of 5 gms and 10 gms as the government has not yet clarified whether it will issue another tranche of Sovereign Gold Bonds (SGB). Trade sources maintained that SGBs have been one of the most expensive tools to bridge the fiscal deficit. This is one of the key reasons for lower issuances by the government.
In FY21, there were 12 issuances, which fell to 4 in last fiscal. There has not been a single SGB issue this fiscal so far.
“Previously, we would suggest that 15% of one’s investment should go to gold. But now since gold prices have started to give 18-20% return annually, the investment should go up to 25%. And gold coins and bars are one of the easiest ways to create assets as no making charge is involved,” said Bhargav Vaidya, a gold trade analyst.
Pune-based PNG Jewellers, which got listed last week, saw 35% growth in sales of gold bars and coins in FY24 through online platforms like Amazon, Flipkart, Ajio and Tata Cliq. “We are expecting to surpass this figure in the current fiscal as demand for gold coins has witnessed a surge already and it will further go up during the festive season,” said Saurabh Gadgil, managing director.
Source: https://economictimes.indiatimes.com/