Gold jewellers forecast a Jump in revenue |Teji Mandi Explains

However, the report also states that this growth will come down to 8-12 per cent in the next financial year due to a higher base effect in the current financial year.

Teji MandiUpdated: Tuesday, January 03, 2023, 07:57 PM IST
article-image
Image Source: Wikipedia (Representative)

According to CRISIL, the revenue of organised gold jewellery retailers may increase by 23-25% during the current financial year.

Let’s explore how this can impact the markets and investors.

What’s happening?

A few days back, CRISIL published a report which said that organised jewellery retails will likely see 23-25% revenue growth during the financial year 2023. This rise in demand is mainly due to a recovery in discretionary consumer spending.

However, the report also states that this growth will come down to 8-12 per cent in the next financial year due to a higher base effect in the current financial year.

So, what does this mean?

An increase in the retailers' revenue directly means an increase in demand and consumption of gold. According to the India Gold Policy Centre report, middle-class people buy more gold and prefer to keep gold physically. On the other hand, people of high-income groups prefer to keep gold in digital or paper format. The demand increases further during wedding and festival season.

The demand for gold has been increasing since the COVID-19 period. According to the World Gold Council, if we compare the demand for gold from 2021 to the third quarter of 2022, gold demand has increased by 14% to 191.7 tonnes. The demand may have boomed further during the wedding season. So, by the end of March 2023, the demand may surpass previous records.

We all know what happens when the demand increases. Yes, there may be a direct impact on the prices of gold. According to a report in News18, by the end of the year 2023, the price of gold may reach Rs 64,000 per 10 grams.

According to Aditya Jhaver, the Director of CRISIL Ratings, organised jewellery retail sales volume will grow by 16-18% to 670-700 tonnes this fiscal year, surpassing the pre-pandemic level of 600 tonnes.

What’s next?

Jewellers will open more stores as the sale of gold picks up, which was reduced during FY21-22. Moreover, an increase in GST penetration and mandatory hallmarking will further increase sales, resulting in an increase in market share.

(If you have a story in and around Mumbai, you have our ears, be a citizen journalist and send us your story here. )

(To receive our E-paper on WhatsApp daily, please click here.  To receive it on Telegram, please click here. We permit sharing of the paper's PDF on WhatsApp and other social media platforms.)

RECENT STORIES

Closing Bell: Indices end with Sensex up 154 points, Nifty at 17606 post-budget

Closing Bell: Indices end with Sensex up 154 points, Nifty at 17606 post-budget

Union Budget 2023 LIVE UPDATES: PM Narendra Modi addresses nation, lauds tax relief for middle class

Union Budget 2023 LIVE UPDATES: PM Narendra Modi addresses nation, lauds tax relief for middle class

Union Budget 2023: From upskilling to job creation, here's what the government announced for Indian...

Union Budget 2023: From upskilling to job creation, here's what the government announced for Indian...

Union Budget 2023: FM Nirmala Sitharaman's paperless budget on mobile app; Download here

Union Budget 2023: FM Nirmala Sitharaman's paperless budget on mobile app; Download here

Union Budget 2023: FM Nirmala Sitharaman delivers her shortest speech lasting 87 minutes

Union Budget 2023: FM Nirmala Sitharaman delivers her shortest speech lasting 87 minutes