Gold Demand In Festive Season To Remain Unaffected By Recent Price Rise: PN Gadgil Jewellers MD

The recent gold price rise is unlikely to impact the demand for the precious metal during the festive season, according to  PN Gadgil Jewellers  Ltd.'s managing director Saurabh Gadgil. Gold prices have been on an upward trajectory, fuelled by geopolitical tensions in the Middle East and the Fed rate cuts announced last month. 

Speaking to NDTV Profit, Gadgil claimed that gold demand will increase during the festive season.

"Gold is not looked at by consumers as a short-term option. It's a part of our culture, emotions, and festivities. So, even gold prices have not been a jitter till now. There has just been a short pushback where people have adopted a wait-and-watch model," he explained

Citing examples of demand during Akshaya Tritiya and Gudi Padwa, considered auspicious for buying gold, Gadgil asserted that people were looking to invest in the precious metal with a long-term goal.

“We saw a phenomenal increase in sales on both these festive days. Gudi Padwa, in fact, had a 70% single-day jump compared to the last year. The same was the case with Akshaya Tritiya—35-40% jump in sales,” Gadgil said.

He bet on strong gold demand during Dussehra, Diwali and the upcoming wedding season.

Talking about the projections for the company, Gadgil said that a 25%  revenue growth looks sustainable for the next couple of quarters. He highlighted that PN Gadgil Jewellers Ltd. reported a 33% year-on-year jump in its revenue for Q1 FY25, beating the industry’s performance. 

“We had a topline of Rs 1,256 crores which increased to Rs 1,670 crores approximately,” he said.

“We have been growing a little more than the industry because of our effort towards store efficiencies and getting more share from competition. For the next couple of quarters, we feel at a 20-25% increase is sustainable and we are confident that we'll be able to achieve those figures,” the top executive added.

 Gadgil said that the company is set to achieve a 13-14% gross margin at the store level and 7% at the retail level in FY25. He further projected a PAT margin of 4% with an increased focus on the diamond business.

PN Gadgil Jewellers Ltd. share price slipped over 8% intraday to touch a low of Rs Rs 695 apiece on the NSE.