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Indian bullion trader banking on gold festival

NEW DELHI — Banking on its finely crafted gold jewellery and silverware, India's largest bullion trader is eyeing success from a planned gold festival here followed by similar meets in Kuwait and Saudi Arabia.

"Despite the high price of gold this year, which has crossed Rs6,800 per 10 grams against around Rs6,300 per 10 grams at this time last year, there is no let up in demand," said S.D. Kapoor, chairman and managing director of MMTC Limited.

"Our Festival of Gold, opening its seventh edition in New Delhi today, has become a big draw not only here but in other cities and even overseas," Kapoor told IANS.

With gemologists, astrologers and palmists adding colour, the Festival of Gold last year netted sales of over Rs160 million ($3.6 million). This year, MMTC is targeting Rs200 million ($4.5 million) sales during the show till October 16.

In each of the exhibitions, over 50,000 pieces of jewellery including diamond and precious stones-studded pieces are put on display to woo all income groups.

"Jewellery from each region has its unique design traits that have been passed on through many generations. Earlier, one needed to travel to procure jewellery of different regions but now consumers can get exquisite designs of different regions at just one platform provided by MMTC," said Kapoor.

He is proud that the MMTC name has become associated with trust, reliability and quality with its hallmarked products.

Following up the success of exhibitions in overseas markets, "We are planning to hold Festival of Gold in Kuwait and Saudi Arabia October 20-27. We are seeking necessary permission from Saudi authorities to get a longer slot," said Kapoor, who views the Middle East as a major market for Indian jewellery.

The Indian government enterprise also has plans to hold exhibitions in markets close to India such as Mauritius, Nepal and the Maldives.

Seeking markets away from major cities, MMTC held its three-day shows at Bellary and Hospet in Karnataka this year and is also exhibiting at Chandigarh as well as Jalandhar and Ludhiana in Punjab.

Eyeing a larger slice of the domestic market, MMTC is planning strategic partnerships with retail stores or established brands for sale of jewellery through duty free shops on consignment basis.

At present MMTC has duty-free shops in Mumbai, Thiruvananthapuram and Chennai airports and is taking part in Airports Authority of India tenders for more such showrooms.

"We are planning to open more retail outlets within the country and expand the franchise for our 92.5 per cent sterling silver products sold under the Sanchi brand," Kapoor said.

"We are at present tying up with major exporters and fabricators for our products but as volumes pick up, we might bring our own designs into the market," he added.

For long a canalising agency for gold imports, MMTC has a sizable share in the country's total imports. Out of the total global gold production in 2004, India imported over 36 per cent, MMTC accounting for over 21 per cent of this share at 134.16 metric tons in 2004.

This year, due to changes in Reserve Bank of India rules and the high price of the yellow metal, MMTC's imports during April-September were lower at 50 tonnes.