* Akshaya Tritiya festival sales seen up from 45T last year
* Gold refineries step up manufacturing for May 16 festival
* Festival on a Sunday may encourage more buying
By Siddesh Mayenkar
MUMBAI, April 30 Indian gold refineries are busy
again after a long lull as a popular festival next month is
likely to see more sales than last year's 45 tonnes with stable
prices and higher economic growth boosting consumer confidence.
The Akshaya Tritiya festival, when Hindus believe they can
get lasting prosperity by buying precious metals, is the second
biggest gold-buying festival after Dhanteras in November in the
world's largest gold market.
In addition, this year's Akshaya Tritiya is expected to
generate more business as it falls on a Sunday when people could
be easily induced into shopping.
Last year the festival fell on a Monday, adding to the gloom
of a volatile market that resulted in sales of 45 tonnes, down 8
percent from 2008, according to World Gold Council (WGC) data.
"We are working more this time. Our order book has increased
by 25-30 percent compared to last year," said Vivek Jain, owner
at S.L. Industries, at his gold refinery, his face glowing from
the light of the red-hot crucibles with molten gold.
Analysts said during this Akshaya Tritiya sales could jump
by more than 10 percent on a conservative estimate.
"The outlook is upbeat. Looking at the (good) last quarter
of 2009 and the first quarter of 2010, I think the momentum
should continue for Akshaya Tritiya especially as prices are
steady and even the rupee is strong," Ajay Mitra, managing
director - India and Middle East said.
"We are definitely looking at higher (sales) figure than
PENT UP DEMAND
In January to April this year, gold imports into India were
at 126 tonnes, up 74 percent on year, provisional data from the
Bombay Bullion Association (BBA) shows.
Demand has revived in India after a dismal performance in
2009 when the worst monsoon in 37 years lowered gold sales with
the year recording 339.8 tonnes of gold imports, down 19 percent
Traders and retailers said pent up demand from the previous
year is also behind the jump in gold sales this year, especially
as economic growth has accelerated. [ID:nBMA006965]
"A big crowd is expected this time due to school vacations,"
said Princeson Jose, chairman of Prince Jewellery, a retailer
with shops in southern Indian states of Tamil Nadu, Karnataka
A wholesaler said stable prices were key to help meet the
projected sales for the festival.
"If prices sustain these levels, we might see good Akshaya
Tritiya," said Pankaj Kumar Agarwal, director, Lucknow-based
Brijwasi Bullions and Jewellers.
Gold prices in India touched their highest level on December
3 at 18,294 rupees ($412.5) per 10 grams, tracking bullish
overseas markets where investors bought gold amid a weakening
This year, a stronger rupee, which is forecast to be at
43.53 against a dollar by March 2011, is keeping gold prices in
a band of 16,000 rupees and 17,000 rupees. [ID:nSGE62U02H]
But any sudden volatility in prices could hurt consumer
sentiment. "If there is a sudden spike in prices our sales will
get affected very badly. Consumers will end up buying 1 gram or
2 grams instead of 5 grams," said Jose.
(Editing by Surojit Gupta)