While online jewellery stores are expecting a manifold jump in demand for gold jewellery, offline jewellery aren't too optimistic this year.
Online retailers including Amazon and Bluestone are betting big on gold and diamond sales and expect a big boost to their business on 'Akshaya Tritiya', considered as auspicious day for buying precious metals. However, physical jewellery stores are not too optimistic about the demand picking up this year even when they desperately need the volumes.
"Compared to last year, we see over six times growth in sales in our Akshaya Tritiya offerings. In terms of traffic, we have grown over 100% compared to last year," Amazon Fashion Category Leader Mayank Shivam said.
The demand is likely to be more for 22 carat jewellery -- especially plain gold chains and necklaces, he said.
"This is apart from the gold bullion sale, which is obviously top selling at this time," he added.
Echoing similar view, online jeweller Bluestone.com COO Arvind Singhai said that business is growing since last two years, and the company expects the sales to jump by six times during Akshaya Tritiya this year as compared to last year.
"This year during the festival we are expecting the demand for gold coins, diamond pendants and earrings," he added.
He also said that he sees no slowdown in demand despite volatility in gold price as the festival of Akshaya Tritiya is considered auspicious for buying precious metals.
However, he said high prices may affect the volumes but the value will grow.
Caratlane.com Vice President Vipin Nair said, "We are expecting a really good turnout this year. Besides gold, we see a lot of movement in diamond jewellery as well." Akshaya Tritiya is falling on Monday.
Physical jewellery stores, however, have already witnessed a bad start to the year. Jewellers called for a pan-India strike on March 2 to protest the 1% excise duty hike on non-silver jewellery, which lasted for over 45 days, accumulating heavy losses for the sector. Jewellers await Akshaya Tritiya every year to boost their sales, but this year, they aren't expecting much.
This year, jewellers are expecting negative to marginal growth compared to last year.
Several places in India are facing a drought, which means that demand from rural areas will dwindle. Apart from that, gold is trading at two-year high prices at about Rs 30,000 per 10 grams, which may also keep customers from digging into their pockets.
"During Akshaya Tritiya, we are expecting marginal growth in sales compared to last year as the prices are ruling very high and due to the present dry weather conditions in the country," All India Gems and Jewellery Trade Federation (GJF) Chairman Sreedhar G V said.
He said even as the overall market sentiment is positive, the surge in gold prices is likely to put a halt on consumer demand for heavy jewellery and people might go for small ticket size items, chains and bangles.
Echoing a similar view, former GJF Chairman Bachhraj Bamalwa said in terms of volume, the consumer demand might witness a negative growth of about 10%, but in value terms it is likely to be at par with last year's sales.
However, World Gold Council (WGC) MD Somasundaram PR felt that there will be sharp hike in demand during Akshaya Tritiya, where wedding jewellery as well as investment-related items like coins, bars will also move fast.
"There will be buying as people will purchase a token small ticket size jewellery or coin for the festival and they will hesitate to go for heavy pieces due to high prices," he said.
(With inputs from PTI)
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