With the precious metal prices hitting a 10-month low, the `Gold Street’ between Punjagutta and Somajiguda in Hyderabad came alive on Saturday as scores of gold lovers flocked the nearly dozen stores dotting this lane to cash in on the sharp drop in gold prices.
Jewellers in the commercial hub of Abids too witnessed increased footfalls through the day as gold rates dulled to around Rs 2,830 (24 carat) on Saturday as against Rs 3,000 per gram earlier in the week. Market analysts, while admitting that this was the biggest single-day drop in gold prices (roughly Rs 1,200), said the precious metal was likely to lose more ground in the coming days.
But while walks-in at most stores in Hyderabad saw a northward movement over the weekend, sales remained largely flat, traders confessed. “This is because of the market anticipation that prices will plunge further over the next few weeks,” said Prasanth Gupta, owner, Musaddilal Jewellers. He, however, expects business to pick up early next month. “Things might start to look up around Akshaya Tritiya (May 12). Also, it is a month of weddings in the state,” Gupta added.
Buyers apart, many of those making a dash for the nearest gold store on Saturday were also prospective sellers, jewellers said, adding that worried about the decreasing value of the yellow metal, these `gold investors’ were left wondering if it was a good time to part with their `stocks’. “The sentiments of people with regard to gold are very weak right now. It is, therefore, unwise to expect people to put their money in it. But, we might see a brief jump in sales in early May,” said Jeetender Agarwal of Sainath Jewellers.
Unlike Hyderabad, the gold r ush’ in the coastal districts of Andhra Pradesh, on Saturday, was hard to miss. Right from Vijayawada to Guntur to East and West Godavari, long-winding queues of buyers were visible outside jewellery stores and banks. Predictably, this came as a pleasant surprise to merchants who had seen little `action’ in the last few months. The prices of the glittering metal here fluctuated between Rs 2,900 and Rs 2,700 per gram.
“It has been a long wait. But now, the fall in prices in likely to boost trade,” said K Vijaya Kumar, president, AP State Jewellery Merchants’ Association. According to him, middleclass consumers who had restricted their gold purchases so far due to its skyrocketing rates, would now return to the market.
The mood remained upbeat among jewellers even in the Port City of Visakhapatnam, where hordes of people have been thronging jewellery stores, right from Ugadi. On Saturday, gold prices in the region were about Rs 2,820 per gram.
John Alukka, managing director of Jos Alukkas, pointed out that the slump in prices, coupled with the festive fervour, were what drew large crowds to the outlets on Ugadi, which resulted in their outlet in Vizag witness a whopping 400 per cent jump in sales compared to the previous day. MMTC records 200% spurt in gold sales
“All over the state, be it Vijayawada or Visakhapatnam, the response has been very good. There has been a nearly 150% jump in sales as compared to the pre-Ugadi period,” he said adding that with the marriage season now looming, the surge in sales will continue for the next month too.
Similarly, the Metals and Minerals Trading Corporation (MMTC), which wraps up its five-day Festival of Gold on Sunday in Vizag recorded a 200 per cent spurt in sales on Thursday alone. MMTC general manager T D Suresh Babu, said, “With gold prices dropping, we logged around Rs 1.5 crore business on Thursday (Ugadi) compared to Rs 50 lakh on Wednesday. We expect more number of people to troop in on Sunday.”
(This Citizen Journalist Report was filed by Deepti Naidu & Renuka Rao in Hyderabad & Vizag)
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