Written byRamya Patelkhana ·
If the sluggish sentiment prevails this will be the second consecutive year of poor sales.
In 2017, the Dhanteras season saw sales plunging more than 30% over the 2016 levels when sales were reasonably good as the note ban was announced post-Diwali.
Last year was one of the worst for the industry in recent years as it was after the note ban and GST implementation coupled with tighter KYC norms for high-value purchases.
"I am not expecting good business this 'Dhanteras'... I am expecting sales to decline by 5-10% from last year," said All India Gem & Jewellery Domestic Council (GJC) Chairman Nitin Khandelwal.
Dhanteras is considered to be an auspicious day for buying gold, silver, and other valuables and is largely celebrated in northern and western parts of India.
Last year, gold prices were ruling a little over Rs. 30,000/10g during Dhanteras.
Domestic gold prices closed at Rs. 32,550 per 10g on Saturday, while globally it closed at $1,233.80 an ounce in New York on Friday.
Reiterating Khandelwal's view, former GJC Chairman Manish Jain said the business was badly impacted during the Dussehra festival, which set the tone for Dhanteras and Diwali, generally considered auspicious for buying gold.
"We are hoping the industry at best matches sales at the last year levels. However, looking at the current sentiments...it may even be slightly lower than that of last year," he added.
Jain said factors like better investment options like mutual funds are also diverting people from purchasing gold during the current festival season.
However, he said, the organized players are expected to do better than last year, and that it is the unorganized sector, which still comprises 70% of the industry, that is feeling the pinch as consumers are grappling with liquidity issues.
Manish Jain said that the industry is yet to fully recover from the note-ban shock as almost three-fourths of the industry is in the unorganized sector.
Meanwhile, Titan's Associate Vice-President for marketing at the company's Jewellery Division, Deepika Sabharwal Tewari, said note-ban and GST have had significant impacts on all industries especially the organized retail jewelry sector.
"We at Tanishq have seen great traction during seasons like Akshaya Tritiya, Gudi Padwa, Teej, Varamahalakshmi, and Durga Puja and we are expecting this to continue during the Diwali season as well. We are expecting demand to be favorable and meet our expectations," Tewari added.
Kalyan Jewellers Chairman and MD TS Kalyanaraman said, "Overall we expect 5-7% volume growth during this Dhanteras compared to last year."
"Consumers have understood that buying from organized players get them best resale value compared to buying from unorganized ones," he said.
The industry, he said, is also moving towards organized from unorganized after the GST, gaining more consumer confidence.
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