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Are Indians buying more gold this festive season?

Closing Bell

Excerpts from Closing Bell on CNBC-TV18 Watch the full show »

Dussehra, Dhanteras and Diwali are the three occasions when gold demand in India surged given the country’s fetish for the yellow metal. Gold prices have already dropped around 8 percent this year and India has imported gold worth USD 3.75 billion in September this year. The World Gold Council estimates gold demand to exceed 380 tonne in the second half of the year.

In an interview to CNBC-TV18, RK Sharma ED & COO, PC Jeweller spoke about the consumer sentiment and gold demand trends this festive season. Meanwhile, Ram Pitre, VP Head Commodity and Currency Research Anand Rathi shared his outlook on gold and how should one approach investing in gold.

Also Read: Dhanteras: Exchanges extend Gold ETF trading session

Below is the verbatim interview of RK Sharma and Ram Pitre with Menaka Doshi & Senthil Chengalvarayan on CNBC-TV18. For the complete interview watch the accompanying videos

Menaka: Because of the decrease we have seen gold prices, gold now at some Rs 27,000 per 10 grams versus Rs 30,000 last year same time are more people coming to your store to buy Jewellery this year. Are consumers finding gold a we bit more affordable?

Sharma: Definitely because last year on the Dhanteras gold rate was around Rs 30,000 and today it is around Rs 27,500 and it is a perception that now gold rate will not go further down. So this is the right time to purchase gold and Dhanteras is an auspicious occasion and Indians love gold they prefer buy jewellery because it is considered good for creating more wealth. So we are getting rush in our stores and shift is now not even on small jewellery but also on medium jewellery and wedding class jewelry.

Senthil: Quick response to that in from an investment perspective is has gold bottomed out? Because that is what he says the consumers think that gold is bottomed out so good time to but anyway?

Pitre: As of now if you see the market at Rs 27,600 looks like we have seen a low of almost a 26,500 or so it is almost again 1000 point rally. But this is corrective rally I don’t think so this is likely to sustain it is a question. Definitely it is further room downside to around Rs 2,000 or so to next Diwali.

However over all if you see I would just like to say about the international market because after seeing a high of almost USD 1,920 and it is fall to almost USD 1,180 and from USD 1,180 we have seen a corrective rally of over USD 1,392 and the fall is almost very drastically from USD 1,392 almost to USD 1,180 again recently. That suggests that this is a triple bottom formation on international market so people feel that this the level where the bottom is in International Market.

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