InvestorQ : How has been the gold and jewelry demand during the current Diwali season?
Deepa Salunkhe made post

How has been the gold and jewelry demand during the current Diwali season?

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Arya Nanda answered.
2 weeks ago
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Some interesting trends have emerged in the last few days in terms of gold and jewelry demand in the Diwali season. Apart from higher gold prices, the lag effect of Coronavirus on incomes and fears of the pandemic kept most customers away.

A spike in gold demand was expected on the day of Dhanteras, the day that is considered an auspicious time to buy gold, cars and other major appliances or even to start new ventures. However, this time around even the emotional connect did not seem to work as the ground realities were relatively harsh. This was despite jewellers offering huge discounts.

Most jewellers admitted that they had faced the poorest sales in more than a dozen years in the festival quarter of October to December. Against the expectation of sales at 80% of last year levels, the actual sales were only 65% of last year levels.

Demand on Dhanteras was better in Tier 2 and 3 Indian cities compared with more urban areas. That could be attributed to higher disposable incomes among farmers and a better Kharif output this year having a salutary effect in rural towns and cities. Although the average ticket sizes are relatively lower, the footfalls are higher by 10-12%.

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