The Hindu : Tamil Nadu News : Gold market has a great future

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Sunday, Mar 23, 2008
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Tamil Nadu

Tamil Nadu

Gold market has a great future

“Coimbatore region is affluent, extremely quality conscious and trendy”

Photo: K. Ananthan

Spiralling price of gold cannot be a deterrent. Volumes might come down.

But with gold being considered the real wealth, gold market has a great future, says Prakash Devji, Managing Director of the Devji International, a jewellery chain in the Gulf.

The company, which came into existence in 1950, has nine branches retailing 22k gold jewellery, including in the Kingdom of Bahrain and Muscat, Sultanate of Oman. It also has an outlet dealing exclusively with handcrafted 21k jewellery and designer diamond.

Wholesale

It has interest in wholesaling 21k jewellery across the Gulf. It is said to have 22 per cent market share in Gulf region.

The company has been exporting gold jewellery to Jordan, Turkey, Yemen, Iraq and Iran.

“We plan to have more branches in the Gulf.”

Mr. Prakash, who is here for the opening of its first outlet in Coimbatore on March 23, its first in India, for retailing diamond jewellery, spoke to G. Satyamurty on the current scenario.

He points out that gold was earlier considered just an investment. Now it is accepted as real liquid wealth.

When all other systems have failed, this continues to hold high. Even in the international market, the portfolio of gold has a very high regard.

Gulf

Gulf gold market is very good. Its popularity is rising even as the consumption is rising.

Similarly, handcrafted jewellery, which is a niche segment, with a maximum share of 5 per cent to 10 per cent in totality, has also a very good market.

The design barriers are breaking down even in Gulf where the customers get attracted to Bollywood designs.

Purity

“Purity of the metal is the most important.” He considers “purity, quality, craftsmanship and value” as the cardinal principles.

For doing business in the Gulf, a minimum of 150 kg to 200 kg of gold is required in each outlet.

The Gold Artisans Association in India, Mr. Prakash feels, should encourage people and create standards. Though the talent is “inborn and passed on from generation to generation,” it would be ideal to have some training.

According to him, designers of jewellery are very few. While there are designing institutes for garments, such institutions are only handful with regard to jewellery.

Of course, there are about half a dozen institutes in India. There should be more to train them.

He is very happy to note that Indian scenario is extremely conducive for opening gold jewellery outlets.

He admits that once upon a time it was quite difficult thanks to the Gold Control Order.

Now, especially with the introduction of Value Added Tax, it has become far easier and transparent to do business.

Though the company is opening only a diamond retailing outlet in Coimbatore, Mr. Prakash is extremely bullish.

“Of course, we have a diamond cutting unit here for the last two decades with a workforce of 300 working on state-of-the art machinery. Besides, Coimbatore region is affluent and extremely quality conscious and trendy.”

That is why the company plans to provide customised service.

Already the company has been making ornaments for upcountry markets and exporting them as well and hence all the items to be displayed are manufactured at its own factory here.

The display will include trendy jewellery, wedding collections, antique jewellery and diamond offerings for the high-end customers.

Mr. Prakash is looking at other parts of the South India as well for branching out the company activities. “They may not be tier-two cities but metros.”

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