India’s jewellery market is experiencing a shift in buying trends,͏͏ with͏͏ a͏͏ broader͏͏ range͏͏ of͏͏ customers͏͏ driving͏͏ demand͏͏ in͏͏ the͏͏ second͏͏ quarter͏͏ of͏͏ 2024.
Increased͏͏ Demand͏͏ for͏͏ Lower-Priced͏͏ Jewellery:
According͏͏ to͏͏ the͏͏ Nuvama͏͏ report,͏͏ affluent͏͏ buyers͏͏ dominated͏͏ purchases͏͏ in͏͏ the͏͏ first͏͏ quarter,͏͏ but͏͏ the͏͏ second͏͏ quarter͏͏ has͏͏ seen͏͏ an͏͏ increase͏͏ in͏͏ demand͏͏ for͏͏ lower-priced͏͏ jewellery͏͏ items.͏͏ Additionally,͏͏ semi-urban͏͏ and͏͏ rural͏͏ markets͏͏ are͏͏ making͏͏ significant͏͏ contributions͏͏ to͏͏ overall͏͏ demand.
Expected͏͏ 18%͏͏ Volume͏͏ Increase:
The͏͏ report͏͏ indicates͏͏ that͏͏ the͏͏ second͏͏ half͏͏ of͏͏ 2024͏͏ may͏͏ witness͏͏ an͏͏ 18͏͏ per͏͏ cent͏͏ increase͏͏ in͏͏ industry-wide͏͏ volume͏͏ demand.͏͏ Experts͏͏ attribute͏͏ this͏͏ growth͏͏ to͏͏ the͏͏ approaching͏͏ festive͏͏ season,͏͏ prompting͏͏ retailers͏͏ to͏͏ expand͏͏ their͏͏ store͏͏ networks͏͏ to͏͏ accommodate͏͏ the͏͏ anticipated͏͏ rise͏͏ in͏͏ customer͏͏ demand.
Continue͏͏ Exploring:͏͏ Jewellery stores͏͏ see͏͏ gold rush͏͏ as͏͏ customs͏͏ duty͏͏ cut͏͏ spurs͏͏ buying͏͏ frenzy
Rising͏͏ Gold Imports:
A͏͏ key͏͏ indicator͏͏ of͏͏ the͏͏ sector’s͏͏ performance͏͏ is͏͏ gold͏͏ imports.͏͏ According͏͏ to͏͏ the͏͏ Nuvama͏͏ report,͏͏ gold͏͏ imports͏͏ in͏͏ July͏͏ and͏͏ August͏͏ 2024͏͏ are͏͏ anticipated͏͏ to͏͏ be͏͏ 11͏͏ per͏͏ cent͏͏ higher͏͏ than͏͏ in͏͏ the͏͏ same͏͏ period͏͏ last͏͏ year,͏͏ with͏͏ August͏͏ showing͏͏ a͏͏ notable͏͏ recovery.
This͏͏ trend͏͏ indicates͏͏ rising͏͏ demand͏͏ in͏͏ the͏͏ jewellery͏͏ sector,͏͏ supported͏͏ by͏͏ ongoing͏͏ gold͏͏ purchases͏͏ by͏͏ central͏͏ banks.͏͏ This͏͏ buying͏͏ activity͏͏ is͏͏ further͏͏ contributing͏͏ to͏͏ both͏͏ price͏͏ and͏͏ volume͏͏ growth͏͏ of͏͏ gold͏͏ in͏͏ the͏͏ market.
Surge͏͏ in͏͏ Gold͏͏ Prices:
Gold͏͏ prices͏͏ have͏͏ soared,͏͏ currently͏͏ standing͏͏ 30͏͏ per͏͏ cent͏͏ above͏͏ the͏͏ average͏͏ levels͏͏ recorded͏͏ in͏͏ the͏͏ second͏͏ half͏͏ of͏͏ 2023.
The͏͏ anticipated͏͏ 18͏͏ per͏͏ cent͏͏ growth͏͏ in͏͏ volume͏͏ presents͏͏ a͏͏ positive͏͏ outlook͏͏ for͏͏ the͏͏ jewellery͏͏ market͏͏ in͏͏ the͏͏ upcoming͏͏ months.
Domestic͏͏ gold͏͏ prices,͏͏ which͏͏ had͏͏ been͏͏ trading͏͏ at͏͏ a͏͏ discount͏͏ for͏͏ five͏͏ months͏͏ due͏͏ to͏͏ excess͏͏ inventory͏͏ and͏͏ weak͏͏ demand,͏͏ received͏͏ a͏͏ boost͏͏ following͏͏ the͏͏ reduction͏͏ in͏͏ basic͏͏ customs͏͏ duty͏͏ announced͏͏ in͏͏ the͏͏ July͏͏ Union͏͏ Budget.
Positive͏͏ Market͏͏ Outlook:
Looking͏͏ ahead,͏͏ despite͏͏ a͏͏ 9͏͏ per͏͏ cent͏͏ year-on-year͏͏ decline͏͏ in͏͏ volume͏͏ during͏͏ the͏͏ first͏͏ quarter,͏͏ the͏͏ market͏͏ is͏͏ expected͏͏ to͏͏ recover.
The͏͏ period͏͏ from͏͏ July͏͏ to͏͏ August͏͏ 2024͏͏ has͏͏ already͏͏ shown͏͏ positive͏͏ signs͏͏ of͏͏ recovery,͏͏ with͏͏ further͏͏ growth͏͏ expected͏͏ as͏͏ India͏͏ approaches͏͏ the͏͏ peak͏͏ wedding͏͏ season.
The͏͏ World͏͏ Gold͏͏ Council͏͏ (WGC)͏͏ has͏͏ projected͏͏ that͏͏ gold͏͏ demand͏͏ in͏͏ calendar͏͏ year͏͏ 2024͏͏ will͏͏ reach͏͏ 850͏͏ tonnes,͏͏ representing͏͏ a͏͏ 12͏͏ per͏͏ cent͏͏ year-on-year͏͏ growth.