Akshaya Tritiya Evokes Mixed Response
One of the most auspicious days to purchase gold as per the Hindu calandar, Akshaya Tritiya turned out to be a mixed bag for jewellers across the country. While some reportedly superseded their past sales others indicated a flattish demand for jewellery and a distinct drop in bullion sales. Shanoo Bijlani and Aliya Ladhabhoy report.
The much-awaited festival for jewellers, Akshaya Tritiya this year, celebrated on May 2 did not glitter as much as it usually does. A combination of several factors – high duties, gold curbs and election regulations played spoil sport. Consumers adopted a ‘wait-and-watch’ response, putting off purchases in the hope of a better faring economy post elections.
In a recent report by World Gold Council, jewellery demand in the first quarter of 2014 reported a 3% rise in volume terms as compared to the first quarter of 2013. Unfortunately, higher import duties and supply curbs imposed by the Indian government resulted in a 9% decline in demand for gold jewellery and a 54% drop in demand for bullion in the country.
As the occasion is considered to be an auspicious day to purchase gold, consumers indulged in token purchases as well as bought mandatory bridal sets for impending weddings. Anil Talwar, owner of Talwarsons in Chandigarh, and cochairman of FICCI’s gems and jewellery committee remarked that sales on Akshaya Tritiya were lower than last year’s.
Talwar noted, “Although this festival, known for driving jewellery sales, is very popular in the South and West of India, it has become popular in the northern India in recent years. For the last four or five years now, we registered maximum sales as compared to any other day of the year. But this year was quite disheartening and sales were about 28% lower than last year, and 41% down from the year before last.” Talwar also informed that people did buy smaller and lighter items priced from R15,000 to R20,000, to mark the auspiciousness of this day.
Election rules, imposing a cap on cash one could carry on person, also marred sales. “This is the first time I have seen that the Election Commission was randomly checking people. The level of strictness was very high. This also affected business to some extent,” said Talwar.
At Abaran, sales figures dropped 1015% informed Pratap Kamath, managing director, Abaran Jewellers, Bangalore. Consumers, however, preferred a good mix of both lightweight and bridal jewellery because of the ongoing wedding season. “We sold more of traditional jewellery this season, and the average ticket price was below R100,000. Bullion sales took a big hit and amounted to only 10% of all our sales this time,” Kamath noted, adding, “The primary reason for the drop in gold coin sales is the weak investor sentiment.”
Despite the bleak scenario, a few jewellers managed to do well. “We were concerned given that the month of April was slow on account of the elections but
fortunately we saw a 25% increase in sales this Akshaya Tritiya,” said Vikram Raizada, CEO of Tara Jewellers, who added that the average ticket size was approximately
R50,000 across their stores. “To mark this favourable day, we introduced a special offer on making charges of R299 per gram on gold jewellery and up to 25% off on diamond jewellery. Our walk-in customers were also surprised with many other exciting bumper prizes at the store.”
Colin Shah, founder and managing director of Kama Jewellery, believes that Akshaya Tritiya is one of the golden seasons for jewellers across the country. Purchasing gold or jewellery on Akshaya Tritiya is an age-old sentiment. It is believed that this day marks a new beginning and brings in prosperity and wealth for the whole year, Shah said. “The rising inflation may have slightly affected the size of the purchase, but not the actual purchase. The market is improving slightly and so is the consumer confidence,” said Shah, whose company recorded a 20% to 25% increase in sales both online and offline.
Popley Eternal’s new gold collection, launched a few days before the occasion, received a good response. “Business this Akshaya Tritiya was better than last year. We received positive feedback from our customers who picked up lightweight as well as bridal jewellery through pre-booked orders as well as on-the-spot purchases,” informed Suraj Popley, managing director, Popley Eternal.
At Manubhai Jewellers, too, the sentiment for gold buying was upbeat. “The occasion fell just after May 1, which being a holiday, brought many more customers to the store. Footfalls this year were above average and we observed a healthy 15% jump in sales of gold jewellery,” said Samir Sagar, director, Manubhai Jewellers.
“This year the market has shown an optimistic demand for gold despite all
the ups and downs the industry has gone through, resulting in positive sales growth for the firm,” said Saurabh Gadgil of PN Gadgil Jewellers, Mumbai, who added that last year the Local Body Tax strike had forced them to keep their shutters down on the auspicious occasion.
Malabar Gold and Diamonds, Calicut, informed that gold jewellery sales increased by 10%, and diamond jewellery sales were up 25% year-on-year. “We saw a 100% increase in precious gem jewellery sales as compared to last year. Most of the customers purchased lightweight ornaments in both traditional and contemporary categories,” he said, adding, “Gold coin sales dropped in comparison to last year on account of government policies.” What drove their sales were the promotional offers starting from the third week of April. The retail house offered 25% off on making charges of gold jewellery and 50% off on making charges of diamond jewellery, and free silver was given on advance booking on Akshaya Tritiya offer.
Bluestone.com saw a phenomenal increase in revenues on Akshaya Tritiya. “We saw an almost 100% rise in revenues for Akshaya Tritiya, and 20% of our overall sales came from religious pendants or specific designs that are inspired from varied divine forms. In addition, since it was a gold buying occasion, this year we saw a slight shift towards plain gold as compared to studded jewellery. This is in contrast to most offline retailer’s sale patterns,” informed Gaurav Singh Kushwaha, CEO, BlueStone.com. The online venture launched their Eternal Gold collection encompassing pendants, earrings and rings customizable in 14-, 18- and 22-karat gold.
For some, Akshaya Tritiya was flat – there was no increase or decrease in sales. Himanshu Shekhar of Manohar Lal Sarraf & Sons commented, “This year sale volumes were at par with 2013, which in today’s subdued scenario, we consider as encouraging. Mid-segment jewellery between R2 lakh and R5 lakh overshadowed bridal jewellery this season, while gold coin sales dropped a whopping 80%.”
Vinod Hayagriv, managing director of C. Krishniah Chetty and Sons (CKC), Bangalore, too witnessed no sales growth. “We saw this happening for the first time in many years, and it shows the market sentiment,” said Hayagriv. For the occasion, CKC had launched its second edition of
the highly successful Navayoni Sri Chakra Yantra and received an excellent response. “We produced 999 pieces of this nine-metal gold and diamond special alloy and we sold all the pieces in about five days, culminating on Akshaya Tritiya. We did not offer any discounts, free gifts, and did not engage in promotions,” informed Hayagriv.
Shreyansh Kapoor, vice president of Kashi Jewellers, Kanpur, commented, “Akshaya Tritiya sales were decent and we met our last year’s targets. It was a good thing that the World Gold Council had declared in advance that the festival would be spread over two days – May 1 and 2 – and this gave us ample leeway to boost sales.
“We are a manufacturing company, so we don’t incur overhead costs. This benefit is passed on to consumers as well and that is the reason why we can afford to sell our low-ticket tag collection with good quality and finish,” said Kapoor.
Traditional and lightweight jewellery were on an upswing this Akshaya Tritiya with consumers opting for jewellery in the midprice segment. “With the wedding season approaching, consumers did purchase bridal jewellery, however we also saw a consistent demand for lightweight jewellery especially in the mid-segment,” informed Ishu Datwani, owner of Anmol Jewellers, Mumbai.
Antique pendant sets with kundan work as well as lightweight antique sets saw much traction this season informed Sagar of Manubhai Jewellers. “Pure gold pendant sets, small neckpieces with corals and pearls and pure gold chandan haar necklaces were popular purchase items.”
Keeping with the trend for traditional jewellery, P N Gadgil Jewellers launched its Satyam Shivam Sundaram collection, a collection inspired by the beauty of Lord Shiva, a few days before the occasion and received a number of enquiries and subsequent purchases being made for the same.
Amar Ghanasingh of Amar Ghanasingh Jewellers, Mumbai, too noted that traditional motifs and jewellery were on top of the charts this time. “We saw a 25% drop in sales this year. Consumers made token purchases and picked up lightweight jewellery. Some did purchase heavy sets for the ensuing wedding season, but they were fewer in number.”
Reema Pahuja, head designer and director of Mumbai’s Tikamdas Motiram Jewellers (TMJ), noted that sales jumped by 15%-20% in value terms this time. “The most popular items were lightweight bracelets and chains. Those who had
planned their purchases much earlier for the wedding season preferred to pick bangles and heavy necklace sets. We saw a good demand for bridal jewellery as compared to last year. We have been noticing that younger customers scout for the desired jewellery pieces much before the festival, and finally make the purchase on Akshaya Tritiya,” she informed.
Though typically gold is the preferred choice on auspicious occasions, there has been a significant rise in the demand for diamond jewellery. Sachin Jain, president of Forevermark India, commented, “We’re glad to say that Akshaya Tritiya was good for Forevermark. Women are increasingly buying daily wear diamond jewellery and Forevermark offers a fine range of designs that appeal to this penchant.”
Kama Jewellery witnessed an increased demand for diamond and platinum jewellery this year and launched an exquisite new range of diamond jewellery titled the Fleur collection which was well-received by its customers. Inspired by nature, the collection is an assortment of pendants, half parures, cocktail rings and earrings. The new Fleur collection is mounted in 18-karat white, yellow and pink gold and embellished with brilliant-cut diamonds, natural pearls and precious coloured stones like emeralds and rubies.
Siddharthaa Sawansukha, managing director, Sawansukha Jewellers, Kolkata, stated that sales were up by 14% as compared with last year. The retail company’s new collection called the Lites consisting of lightweight bridal jewellery was received well. “However, our diamond jewellery fared better and on an average people purchased jewellery in the range of
R2.50 lakh. Of all the jewellery sold, around 40% consisted of gold jewellery, while the rest consisted of diamond, jadau and polki pieces. Bullion comprised around 7% of the entire sales.”
“Sentiments towards gold jewellery were not so robust, but we converted the walk-ins to buy diamond jewellery,” informed Kapoor. “
“Diamond jewellery sales this Akshaya Tritiya saw a more-than-average growth and has been growing over the last few years. Though sales were not as fabulous as that of gold,” said Sagar.
With diamonds gaining prominence, rising inflation, fluctuating gold prices, does this mean a downward turn of tide for gold? “Around 10 years ago we were concerned that the next generation may not be favourable towards gold. But over these years, we have seen younger consumers are more enthusiastic to connect with their roots, and are opting for antique and heritage jewellery. There are times when we have seen budgets being split between gold and other luxury purchases. However, since the festival itself is so closely tied to religious sentiments, buying gold will always be prevalent; even if it is as a token purchase or for occasions,” Sagar summed up.
Malabar Gold and Diamonds
Gaurav Singh Kushwaha
Malabar Gold and Diamonds
Malabar Gold and Diamonds