Diamond has started to profit at the cost of high gold prices. As gold prices hover between Rs 16,000 and 18,000 per 10 grams, customers of the yellow metal have started switching loyalty in search of value and status symbol, according to dealers.
“Sales of gold jewellery have come down by 20 per cent since the rise in prices, while diamond sales have shot up 20 per cent during the period. We have seen a large number of conversions (of customers) from gold to diamond,” said Mehul Choksi, cgairman and managing director, Geetanjali Diamonds. “There is a strong demand for diamond in the domestic market, especially in the sub-Rs 50,000 range, and diamond prices will go up by 15 per cent.”
According to experts, many working women are now opting for diamond. “Many of our customers are in the age group of 18 to 35 and they are buying diamond ranging from Rs 10,000 to 4 lakh,” said Nitin Goenka, managing director, Goenka Diamonds.
“There has been a definite shift for diamonds in north, west and east, while people in the south still prefer gold,” he said.
Due to recession in the key US and European markets, diamond suppliers have started concentrating in the domestic market, where a large number of people are witnessing a rise in disposable incomes.
According to experts, diamond makes a fashion statement and yields returns of 8 to 12 per cent as against the uncertainty in gold prices.