Muthoot Pappachan Group targets to collect a tonne of scrap gold in 2017-18

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The precious metals division of Muthoot Pappachan Group is expecting its Muthoot Gold Point business to hit a tonne of gold from the market for recycling by year 2017-18. Muthoot Gold Point, launched last year, is for buying scrap and used gold directly from customers. It had collected 140 kg of gold last year.

The company has launched seven Muthoot Gold Point centres last fiscal year and plans to open another seven centres during the current fiscal year, which would be in full fledged operation during the next fiscal year.

"During 2015-16, we have refined around 140 kilogram of gold, by buying it from customers and selling it as scrap gold to refiners. This year, we are expecting this to be double at least," said Keyur Shah, CEO of Pretious Metals Division, Muthoot Exim.

He said the expectations are based on the fact that the seven centres were opened last year, which would be working full year this time, while the new centres would be operating for a few months during the fiscal year.

"Our target for the third year, which is 2017-18, is one tonne of gold to be collected through the centres. Because by then I will have at least 15 branches, all operational for 12 months," he added.

He said that while Muthoot Exim is the only organised player in this field now and there is room for more organised players to come in, since the government has been promoting recycling gold instead of doing imports. Conversion ratio in these branches are over 80-90%, which shows that the customer also prefers to sell old gold through an organised retailer, he claimed.

The precious metals business of the group has clocked in revenue of Rs 210 crore during 2015-16.