Narendra Modi fails to dull gold’s lustre in India

{"text":[[{"start":8.92,"text":"Indians are ignoring calls by Narendra Modi’s government to curb gold purchases, according to the country’s biggest jewellery retailer."}],[{"start":17.44,"text":"Profits at Titan — part of the Tata conglomerate — rose by 63 per cent, while footfall also increased in the most recent quarter. Jewellery accounts for the vast majority of the chain’s earnings."}],[{"start":29.56,"text":"The increase came despite the Indian prime minister in May asking citizens to pause gold purchases and more than doubling import duties to 15 per cent amid the Iran conflict."}],[{"start":41.06,"text":"Modi reiterated that appeal earlier last week, asking Indians to avoid buying gold “if not necessary”."}],[{"start":47.36,"text":"Ajoy Chawla, managing director of Titan, which sells jewellery, watches and eyewear across almost 3,700 stores, said the impact of those measures was “not long lasting”, with demand driven more by customers’ perceptions of the gold price."}],[{"start":62.52,"text":"“Their love for the product and gold is there, that is not disappearing,” Chawla told the FT. “They are looking at it as a store of asset value. Even for a person who is not necessarily planning to sell their jewellery ever, they look at it as a portfolio.”"}],[{"start":78.24,"text":"This year’s oil price shock exposed India’s energy dependence on the Gulf, putting pressure on its currency and foreign exchange reserves."}],[{"start":85.76,"text":"The bid to curb gold purchases was part of a drive by New Delhi to help prop up the sliding rupee by reducing imports. India accounts for about a third of global demand for gold jewellery, with sales jumping about a third year-on-year to $21bn in the June quarter, according to the World Gold Council."}],[{"start":104.04,"text":"Along with the duty increases, Modi made an unusual appeal to Indians as he asked them to avoid buying the metal that holds a deep cultural and religious significance in festivals and weddings, as well as acting as an investment. “For a year, be it any function, we shouldn’t buy gold jewellery,” he said at the time."}],[{"start":122.16,"text":"That call appears to have fallen on deaf ears. The World Gold Council said in July that major listed Indian jewellery merchants had reported strong quarterly earnings, with revenue growth of 30 to 60 per cent year on year, supported by religious festivals and the summer wedding season."}],[{"start":null,"text":"

"}],[{"start":139.24,"text":"While more middle-class Indian families are increasingly investing in shares and mutual funds, Titan finance chief Ashok Sonthalia said that gold remained highly favoured as an investment vehicle. “Even if I am, say, a very financially savvy guy, I would still invest in gold,” he said."}],[{"start":156.5,"text":"Accounting for nearly a tenth of India’s vast and highly fragmented jewellery market, Titan’s share price has risen by almost a quarter this year. Meanwhile, the blue-chip Nifty 50 index that includes the retailer is down almost 9 per cent over the same period."}],[{"start":171.16,"text":"Nomura analysts said Titan was “on a strong wicket” as consumer demand returned following a hiatus last year."}],[{"start":177.96,"text":"Titan was established in the 1980s by Xerxes Desai, a Tata executive who suggested setting up an Indian watchmaking company to the conglomerate’s then chair JRD Tata, according to Made in India: A Titan Story, an Amazon series released this year."}],[{"start":193.56,"text":"Titan is now one of the world’s biggest watchmakers by volume and also has a presence in the US, Middle East and Singapore, catering to the Indian diaspora."}],[{"start":202.64,"text":"Chawla said Titan is looking for potential acquisitions to diversify its emerging fashion and lifestyle business that includes handbags and perfume."}],[{"start":211.08,"text":"The Bengaluru-based group last year took a majority stake in Damas, a Middle East jeweller with nearly 150 stores."}],[{"start":218.36,"text":"The Middle East conflict helped push Titan’s international business, which accounts for about 5 per cent of annual revenues, to a Rs80mn ($836,000) loss in the June quarter."}],[{"start":229.28,"text":"Chawla said that proportion of Titan’s revenues could rise to as much as 10 per cent by 2030 amid expansion in the Middle East and North America. The company plans to open more stores in Canada this financial year."}],[{"start":241.6,"text":"“Where there are quite a few Indian diaspora, that opportunity remains,” he said."}],[{"start":250.24,"text":""}]],"url":"https://audio.ftcn.net.cn/album/a_1788761281_9639.mp3"}