Silver sizzles in festive spirit

Silver is sizzling this festive reason, despite having hit record prices this week. The auspicious day of Dhanteras, followed by Diwali, has seen strong sales of the white metal, even as gold purchases have remained robust.

“The sales have been fantastic. We have seen at least a 33 per cent increase in sales this year, compared to last year, even though the value of the metal has gone up. Compared to gold, silver remains affordable and the interest in the metal is likely to increase,” said silver wholesaler Yatish Somaiya.

Even though the price of the metal has appreciated by about Rs 9,000 since the corresponding period of last year, Somaiya explained that it remains the consumers' preference for bulk presents or gifts, apart from being a prudent investment option.

“There are hardly any gift items that can be made in gold and, in any case, the volume of gold purchases have been coming down as consumers are buying more studded jewellery,” he added.

Gold jewellery, however, has seen significant growth, in value terms, regardless of the prices hovering around the Rs 20,000 per 10 grams.

“The sales have been better than last year, but less quantity has been bought because of the high prices. The value has increased, without the same sort of growth in volume,” said Pankaj Parekh, regional chairman of Gem and Jewellery Exports Promotion Council.

But Parekh added that silver purchases, too, were displaying good fundamentals. “About two decades back, silver constituted the majority of sales during Dhanteras. Subsequently, the trend has changed with gold becoming more popular. But more people will now move towards silver,” he said.

The investment proposition of precious metals, according to Subir Sen of B C Sen Jewellers, is likely to continue to bring more people into jewellery stores and, along with gold, the price rally of the white metal will attract more consumers.

“Silver has also seen considerable demand as its prices have gone up. For the remainder of the year, there should be good business, although there will be some impact on volumes. But people are inclined to buy more precious metals,” Sen added.