This Akshaya Tritiya, jewellers depend on the emotional sentiment for gold for sales. After Dhanteras, this is the biggest gold buying festival in India. To celebrate the festival and boost sales amid record high gold prices, banks and jewellers alike have various discounts and offers for the consumers.
Their enthusiasm for the gold-buying festival, though high, doesn't come without slight hesitation concerning demand due to high prices for the precious metal.
HDFC Bank is optimistic about gold coin sales and investment in paper gold this season. "During these festivals one sees a lot of offtake in terms of gold coins, banks also become aggressive in selling," a senior official from HDFC Bank told Business Standard.
On the eve of Akshaya Tritiya and on the festival, HDFC Bank has a special offers for its credit card holders, he said. If you buy gold coins using the HDFC credit card, the customer would be eligible for a three-month interest-free EMI. Also, discount offered on gold coins would vary according to the volume purchased.
Similarly, ICICI Bank is offering an 8% discount on gold coins of 99.99% purity and the World Gold Council in partnership with India Post and Reliance Money are offering a 6% discount on gold coins.
Gold prices are reigning high due to weak Asian and global equitites. Investors are flocking to the safe-haven asset as risk aversion in the face of the ever-deepening Eurozone crisis, analsyts said.
Despite this, jewellers and banks are confident about the sale of gold jewellery, paper gold and coins during the festival.
In 2011, gold prices surged 48.2% from an annual low of Rs 19,660 to Rs 29,140. India still imported 969 tonnes of gold in the year, World Gold Council's report said. This was only a few tonnes short of the 1,000 tonne imports expected by WGC in the year.
“In fact, during 2011 Indian households continued to turn to gold as a store of wealth, with gold now accounting for 7% of household savings," Ajay Mitra, managing director, India and West Asia, WGC said.
Many women in Gujarat buy gold on Akshaya Tritiya or Akha Teej, as it is known in the state.
Maithili Janakiraman, 45, living in Surat bought gold jewellery two days back as she believes, "Gold prices inevitably shoot up on the day of the festival."This gold would be for her younger daughter's wedding, she says.
Her elder daughter Vidya Desai, 25, living in Baroda, got married in 2010 and always buys gold on the festival. "I am specially going to Surat to buy gold jewellery with my mother on the occassion of Tritiya," she says. Surat is famous for its gold and diamond jewellery.
Tribhovandas Bhimji Zaveri, a gold and diamond jewellery store has special offers for its 'Kalpavruksha' members, under which customers are eligible for a monthly instalment scheme. "On the eve of Akshaya Tritiya and on the festival, members would be entitled to a 35% discount on gold jewellery making charges and a 50% discount on diamond-jewellery making charges," an official from the store based in Zaveri Bazaar, Mumbai said.
"This festival is considered to be very auspicious," Maya Jain, a housewife living in Gujarat said. "I bought gold last year and would also buy tomorrow," although prices have now touched Rs 27,000. "People who want to buy on the festival don't see prices," she said.
People buy anything new, for instance, a car, two-wheeler, gold, silver and worship the new asset on the occassion of Tritiya, Dipti Shah, an ardent believer of the festival said.
Despite gold touching a two-month high, jewellers are expecting about 15 tonnes of sale of the metal, Tuesday, a report from Press Trust of India quoted the Delhi Bullion and Jewellers Merchants Association as saying. This is 5% more than sales on last Akshaya Tritiya.