Gold Jewellery Retailers Revenue To Increase 23-25 Percentage
- 24 Apr
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Gold jewellery retailers are expected to witness significant revenue growth, with projections indicating a potential increase of 23-25% in the coming years. Moreover, this growth is possible due to several factors, including increased demand for gold jewellery, a rise in disposable income, and the growing popularity of gold as an investment option.
Gold jewellery has always been a preferred choice for adornment and gifting purposes. With the current economic scenario, more and more people are turning towards gold as a safe and lucrative investment option. With this surge in demand, gold jewellery retailers will likely witness substantial revenue growth.
Let's check about this in more detail.
What Do Reports Have To Say About The 23-25% Revenue Growth?
As a result of pent-up demand and a comeback in discretionary spending, organised jewellery retailers are anticipating a 23 to 25 per cent increase in revenue this fiscal year.
Crisil Ratings stated in a report released that the earnings of organised gold jewellery retailers, which increased by 36% in the previous fiscal year on a low base due to the pandemic-ravaged FY21, will increase by 23 to 25% this fiscal year due to pent-up demand and a restoration in discretionary spending.
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In 2023-24, however, the report forecasts that the hike will moderate to 8-12 percent due to the larger base of the current fiscal year and the modest growth of spending power, which will have an effect on discretionary spending.
In this situation, the operating margin will probably decrease by 40 to 70 basis points year-over-year. So it results from higher marketing and store-related expenses before normalizing at the pre-pandemic range of 6.7% to 7.0% in the current fiscal year and FY24.
According to Crisil Ratings, organised players credit assessment is steady.
Moreover, according to the report, the organised sector makes up almost one-third of the market. In contrast, the highly fragmented unorganised sector represents the remainder.
What Experts Have To Say?
Experts expect organised jewellery retail sales revenue to surpass the pre-pandemic threshold of 600 tonnes by growing 16–18% year over year. Wedding and festival demands, representing 80–85% of jewellery sales, will significantly drive this growth. Further, the realisation would also assist the earnings growth with an estimated 5-7% yearly increase.
Increasing Goods and Services Tax (GST) penetration and mandatory hallmarking will further support volume growth. Additionally, it will help the organised players, leading to increases in market share for them.
Thus, retailers anticipate increasing their store count by 10-15% during the following two fiscal years.
An extra store will require more inventory, resulting in more working capital debt.
The improvement in gross bank credit to the industry, which will likely remain over the medium term, indicates a greater availability of bank financing to established gold jewellery merchants.
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The impact of increasing interest expenses because of greater debt will be mitigated by strong revenue growth and improved operational leverage. Further, the ratio of total external obligations to tangible net worth and interest coverage will rise from the pre-pandemic values of 1.4 times and 6.3 times, correspondingly, to 1.0 times and 9.80 times, respectively, this fiscal. Moreover, the ratios will also stay favourable in the fiscal year 2024, as experts say.
The report added that keeping an eye on the gold market's extreme volatility, changes to import taxes and restrictions, and consumer sentiment is essential.
Is It The Right Time To Invest In Gold?
Gold prices often increase when the economy is struggling and going is difficult. Because of this, gold is a wise investment for anyone who wants to safeguard their money in difficult times. A safeguard against inflation might be gold. Despite current market changes, gold is still a reliable investment, and some experts think that the first quarter of 2023 is a good moment to buy or sell gold. Yet, ultimately, you and your financial condition should choose whether to invest or not.
How To Get Cash For Your Gold?
The best way to get cash for your gold is by selling to a reputable buyer of gold.
Here are some tips to help you sell your gold jewellery for maximum profit:
1. Know the value of your gold jewellery: The value of gold is determined by its purity, weight, and market price. You need to know its value to get the maximum profit from selling your gold jewellery. You can use online gold calculators to estimate your gold's value based on its purity and weight.
2. Find a reputable buyer: When it comes to selling gold jewellery, finding a reputable buyer is crucial. Search for sell gold near me and filter out all your options. Additionally, you can also ask for recommendations from friends and family.
3. Compare prices from different buyers: Don't settle for the first offer you get. Shop around and compare prices from different buyers. This will help you get the best price for your gold jewellery.
4. Sell at the right time: The price of gold fluctuates, so it's important to sell at the right time. Also, keep an eye on the market price of gold and sell when the price is high.
The best place to sell gold is 24Karat. our experts will evaluate your gold's purity using our Karatmeter and then offer you a quote. If you accept the quote, we will proceed further.
Whether you are selling gold coins, jewellery, or other precious objects, we can help you get the best value on your valuables. Reach out to https://www.24karat.co.in/ for more details.