Neal Bhai Reports — MMTC may offer Buyback Option for Gold Coins — MMTC may offer buyback option for Indian Gold coins this Dhanteras to boost sales and give consumers the option to liquidate coins when they want to.
The move comes close on the heels of a report -India’s gold investment evolution, Indian Gold Coin: An introduction to branded gold coins -by Nielsen India which says Indian Gold coin is the preferred investable instrument over unbranded coins available in the market.
The report, which was commissioned by World Gold Council and MMTC, indicated that the preferred denominations of coins are 2, 5 and 10 grams among Indian consumers. India consumes 90-100 tonnes of gold coins annually.The Indian Gold Coin is currently available in denominations of 5 and 10 gram coins and a 20 grams bar. MMTC has sold 185 kg of sovereign gold coins since its introduction in November last year. The agency has already tied up with four banks -Indian Overseas Bank, Yes Bank, Federal Bank and Vijaya Bank -to distribute gold coins.
“Talks have reached the final stage with HDFC Bank to distribute the coins. We hope to seal the agreement with HDFC Bank in a day or two. Talks are also on with SBI and ICICI Bank and we hope to enter into an agreement with them before Diwali,“ said a senior MMTC official, who is involved in the distribution of Indian Gold coins.
The official also said that a buyback option for the gold coin is under consideration and MMTC is likely to announce it closer to Dhanteras when gold buying picks up across India. The agency is expecting to sell 500-600 kg of gold coin during Dhanteras. “In all probability, MMTC will buy the gold coins at the 24 carat gold rate of that day,“ the official said. The sovereign gold coins are made out of the gold that is collected through the Gold Monetisation Scheme.
Somasundaram PR, managing director, World Gold Council (India), said according to the study, women prefer to visit jewellers to buy coins while men prefer banks. “MMTC is beefing up its presence through banks and its own outlets. The branded coin market is miniscule in India though the country sells 90-100 tonnes of gold coins annually. There is room for introducing branded coins in India. Indian Gold Coin fills a gap in the international basket of gold coins.“ The total investment demand for gold in India is around 200 tonnes annually. — Gold Silver Reports