Mumbai: Gold sales wear a dismal outlook ahead of Monday's festival of Dhanteras

MUMBAI: Gold sales in Mumbai wore a dismal outlook ahead of Monday's festival of Dhanteras. This is one of the biggest purchase mahurats of the year. However, rates have soared past Rs 32,500 per 10 gm which has caused buyers to shrink back.
Zenil Shah, who owns the 40-year-old RSJ (Rasiklal Sankalchand Jewellers) on M G Road, Ghatkopar, said, "There are buyers who anticipate that rates will escalate further and therefore choose to buy this day. Like the rest of the trade, we are not too optimistic about this season either. We are concentrating on jewellery, although we do stock some amount of coins also. Otherwise we will only be catering to bullion buyers while leaving our core business, that is jewellery, unattended. All jewellers prefer to trade in ornaments rather than coins."

Kiran Soni of Soam Jewels, Zaveri Bazar, said, "Gold rates have been rising steadily since the past two months. So people by now are habituated to the rates. Of course we expect volumes to be low. Those who buy 5gm may buy 2-3gm. I feel coins will sell more than ornaments because jewellery requires a bigger budget. For those with a modest budget of Rs 3,500-4,000, 1gm coins are a better option because you can hardly buy any ornaments with that amount. Moreover, with jewellery there is the dilemma over choice of item and design. One may like a certain design but it may not be within budget." He says they do stock fresh designs at every festival, but there is the dilemma of exhausting old stocks first.

All goldsmiths are trying to hold optimism amid the gloom. Zaver Kothari of Pradeep Jewellers, one of the biggest stores in Lokhandwala Complex, Andheri, said, "We are expecting customers to buy low value ornaments in the range of Rs 15,000-20,000. Some do come with modest budgets of Rs 3,000-5,000 also. Certain customers have already selected their items and will take delivery this day."

Zenil Shah's experience gives him a different perspective. "Unlike the past, not many customers select items in advance. These days the sentiment is that I want to buy it and wear it now. Nobody has time or patience to visit the store two times for one purchase," he says.

Soni says large branded stores do better business than neighbourhood stores given that high value customers are accustomed to shopping here. "Just yesterday I saw a customer's bill for a 10 gm coin which totalled Rs 38,416. The normal rate is Rs 33,000 or so but the store had charged Rs 34,500 as rate of gold, plus Rs 2,500 as making charges and then added GST. A 24 carat gold coin is a 24 carat gold coin. Had the customer bought at a smaller store, he would have saved Rs 5,500," he said.