STOCKS | Modi’s Gold Curbs Fail to Dent India Demand

India’s largest jewelry retailer said people have not heeded Prime Minister Narendra Modi’s calls to curb gold buying. According to Sina Finance, Titan, part of Tata Group, reported 63% profit growth and higher foot traffic in the latest quarter, while jewelry accounts for most of its revenue. Despite Modi’s May appeal for people to pause gold purchases and his decision to more than double import duties on gold to 15% during the Iran conflict, demand still rose. He renewed the appeal earlier last week, asking Indians not to buy gold unless necessary. Titan Managing Director Ajoy Chawla said the measures have not had a lasting effect and that gold demand depends more on consumers’ view of prices. Titan sells jewelry, watches and eyewear at nearly 3,700 stores in India. World Gold Council data showed India accounts for about one-third of global gold jewelry demand. In the June quarter, India’s gold jewelry sales rose about one-third from a year earlier to $21 billion. World Gold Council said in July that major listed Indian jewelers posted strong quarterly results, with revenue rising 30% to 60% on religious festivals and the summer wedding season. Titan Chief Financial Officer Ashok Sonthalia said gold remains a favored investment tool, even as more Indian middle-class households invest in stocks and mutual funds. Titan holds nearly one-tenth of India’s large and fragmented jewelry market, and its shares have risen nearly one-quarter this year. By comparison, the Nifty 50 blue-chip index, which includes Titan, has fallen nearly 9% over the same period. Nomura analysts said Titan is “well positioned” as consumer demand recovers after last year’s stagnation.