Rally in gold prices dents jewellery demand, any correction 'welcome': Titan

The surging rally in gold prices, while boosting the gains for savvy investors who hold the safe-haven metal, has dampened the sentiment for prospective buyers, especially in the sub-Rs 50,000 category, noted jeweller and watchmaker Titan Company's management.

"Now some of it is us vacating price points because simply gold price goes up. The same product goes into a certain higher price band," said Ajoy Chawla, CEO of the jewellery division. "That is one part of the story. But in the lower price band, we are seeing some buyers being a little reticent."

Further, as a result of surging prices, customers have become more open to purchasing 18k gold. As a result, Titan has launched collections in 18k gold for the traditional customers. In the CaratLane brand, gold jewellery of 9k has also been launched. "There is early traction, I think more and more customers are going to be open to lower caratage simply because the price point has become quite a bit," added Chawla.

On the higher price bands, while there is buyer growth, Titan is seeing customers scaling down the complexity of product they are willing to buy. If earlier, they were open to buying a higher making charge product, they are sliding down a bit, looking for lightweight jewellery, lower caratage jewellery and jewellery with lower making charges.