Dear Comrades,
The rush for gold seems to be keeping pace with the sharp increase in prices of the yellow metal.
Consider this: India Post is targeting to cash on the Diwali season and sell about one tonne of coins in the next two months alone. During the whole of last year, India Post sold around half a tonne.
Around 700 post offices across the country would sell gold coins this year. In 2009-10, around 25,000 investors purchased gold coins from 500 outlets. This year, the number is already 40,000.
“While the price has been going up (it ended last week at Rs 26,860 per 10g), consumers are expecting even higher prices. We anticipate the festival season to be a roaring success,” says Ajay Mitra, managing director-India, World Gold Council (WGC). WGC is planning elaborate campaigns across the media and on-ground promotions beginning October 1.
India Post, which recently got into the selling of gold coins, has also ramped up capacity for the festival season. “India Post has added 200 outlets this year. Many, are in the South. We are expecting good sales through this channel, too,” says Mitra.
Over the last decade, gold has been one of the best investments for the Indian retail investor.
According to a JPMorgan report, India is home to more than 18,000 tonnes of gold (about 11 per cent of the global stock), worth about $1.1 trillion (versus an equity market cap of $1.2 trillion). Gold holdings are also more evenly distributed across Indian households as compared to stocks.
| N Sundaresha Subramanian & Mehul Shah / Mumbai September 26, 2011, 0:16 IST business-standard.com |
