Introduction:
In a notable shift from tradition, young urban Indian grooms are increasingly favoring platinum jewelry over gold, providing relief to the bride’s family amidst soaring gold prices, which have recently crossed ₹61,000 per 10 grams. Platinum, currently trading at around ₹25,000 per 10 grams, is becoming the preferred choice for men’s jewelry, particularly chains, bracelets, and studded earrings.
Joy Alukkas, chairman of the renowned retail jewelry chain Joyalukkas, observed that Indian men are now seeking thin platinum chains with intricate designs. This trend signifies a departure from the conventional heavy gold chains and reflects a growing preference for platinum among men. According to Alukkas, this trend has witnessed substantial growth, with a 25-30% increase in men’s platinum jewelry sales during the festive season. Joyalukkas, with its 100 showrooms across India, predicts that this trend will continue throughout the marriage season until March.
Interestingly, even men residing outside major cities in India are showing interest in platinum jewelry. This group tends to favor bracelets and chains priced below ₹2 lakh, which avoids the need for a Permanent Account Number (PAN) required for purchases exceeding ₹2 lakh.
Cricketer Surya Kumar Yadav has been enlisted as the face of men’s platinum jewelry by Platinum Guild International. This move has significantly contributed to the growth of partner retailers during the festive season, according to Vaishali Banerjee, Managing Director, India, at the organization promoting platinum jewelry.
While young Indian men are increasingly considering gold as an investment instrument, opting for gold exchange-traded funds and sovereign gold bonds, platinum’s appeal lies in its unique designs and the absence of the traditional gold sheen. However, it’s worth noting that the making charge for platinum jewelry is relatively high due to the metal’s hardness, requiring high-temperature melting. Despite this, platinum jewelry remains cost-effective compared to gold.
Analysis of this news for a layman:
In recent times, Indian grooms are choosing platinum jewelry over gold due to the significant increase in gold prices. Platinum, currently trading at a lower rate, has become more appealing for urban men. The trend involves preferring thinner platinum chains and other jewelry items over traditional heavy gold ones. This change has been particularly noticeable during the festive season, with several jewelry retailers reporting a substantial rise in the sales of men’s platinum jewelry. Even men from smaller towns are joining this trend, mainly purchasing items priced below ₹2 lakh to avoid tax-related requirements. Additionally, cricket player Surya Kumar Yadav’s endorsement of men’s platinum jewelry has boosted its popularity.
Original Analysis:
The shift from gold to platinum jewelry among Indian grooms signifies a response to the sharp increase in gold prices. Gold has long been considered a valuable asset, especially in the context of weddings, where the bride’s family typically gifts jewelry to the groom. However, the surging prices have prompted a reevaluation of this tradition, leading to the emergence of platinum as an attractive alternative.
Platinum’s appeal lies in its unique designs and its suitability for those who appreciate subtlety over ostentation. It has gained traction among young Indian men, particularly in urban areas, who now prefer thinner and more intricate platinum jewelry. This trend is not limited to metropolitan regions; even men from smaller towns are embracing it, opting for platinum bracelets and chains priced below ₹2 lakh to avoid tax requirements.
The endorsement of men’s platinum jewelry by Surya Kumar Yadav, a well-known cricketer, has further propelled this shift in consumer preference. Yadav’s association with Platinum Guild International has not only boosted the profile of men’s platinum jewelry but has also contributed to the growth of retailers during the festive season.
While gold continues to be viewed as an investment, with individuals opting for instruments like gold exchange-traded funds and sovereign gold bonds, platinum’s popularity seems to stem from its aesthetic appeal rather than its investment value. Despite platinum’s higher making charges due to its hardness, it remains a cost-effective choice compared to gold.
Impact on Retail Investors:
For retail investors, this trend highlights the changing dynamics of the jewelry market. While it may not directly affect investment decisions, it reflects evolving consumer preferences and can provide insights into broader market trends.
Impact on Industries:
This shift impacts the jewelry and precious metals industries. Jewelers offering platinum jewelry, especially those with innovative designs, are likely to benefit from increased demand.
Long Term Benefits & Negatives:
Over the long term, the preference for platinum among Indian grooms may lead to a diversification of jewelry offerings in the market. However, its impact on gold prices or investment patterns is likely to be minimal.
Short Term Benefits & Negatives:
In the short term, jewelers specializing in platinum jewelry are likely to experience increased sales and revenue. However, the immediate impact on gold prices or the broader economy is not substantial.
Companies that will gain from this:
- Jewelry Retailers: Companies that offer platinum jewelry are likely to benefit from the growing demand.
- Platinum Manufacturers: Manufacturers of platinum jewelry and associated components stand to gain.
Companies which will lose from this:
- Gold Retailers: As consumers shift toward platinum, retailers primarily dealing in gold may experience a slowdown in sales.
| Company | Potential Impact on Market Sentiment | Factors to Consider |
|---|---|---|
| Platinum Guild International (PGI) | Positive: The news that young urban grooms in India are increasingly preferring platinum jewellery is likely to have a positive impact on market sentiment towards PGI. This is because it suggests that PGI’s marketing campaigns are successful and that there is a growing demand for platinum jewellery in India. | * PGI’s reputation as a leading marketer of platinum jewellery. * The potential for PGI to increase its sales of platinum jewellery in India. * The potential for PGI to expand its market share in India. |
| Retail jewelry chains in India | Positive: The news that young urban grooms in India are increasingly preferring platinum jewellery is likely to have a positive impact on market sentiment towards retail jewelry chains in India. This is because it suggests that there is a growing demand for platinum jewellery in India, which could lead to increased sales of platinum jewellery for these companies. | * The reputation of retail jewelry chains in India. * The potential for retail jewelry chains in India to increase their sales of platinum jewellery. * The potential for retail jewelry chains in India to expand their market share. |
| Gold jewelry companies in India | Mixed: The news that young urban grooms in India are increasingly preferring platinum jewellery could have a mixed impact on market sentiment towards gold jewelry companies in India. On the one hand, it could lead to decreased demand for gold jewellery for grooms, which could negatively impact sales. On the other hand, it could also lead to increased demand for gold jewellery for brides, which could offset the decline in sales for grooms. | * The reputation of gold jewelry companies in India. * The potential for gold jewelry companies in India to increase their sales of gold jewellery for brides. * The potential for gold jewelry companies in India to expand their market share for brides. |
| Global platinum producers | Positive: The news that young urban grooms in India are increasingly preferring platinum jewellery is likely to have a positive impact on market sentiment towards global platinum producers. This is because it suggests that there is a growing demand for platinum jewellery globally, which could lead to increased prices for platinum. | * The reputation of global platinum producers. * The potential for global platinum producers to increase their prices. * The potential for global platinum producers to increase their profits. |
Overall, the news that young urban grooms in India are increasingly preferring platinum jewellery is likely to have a positive impact on market sentiment towards PGI, retail jewelry chains in India, and global platinum producers. The impact on gold jewelry companies in India is mixed.
Additional Insights:
The trend of Indian grooms choosing platinum over gold represents a departure from tradition and underscores the importance of aesthetics and personal preferences in consumer choices. It also highlights the role of endorsements by public figures in shaping consumer behavior.
Conclusion:
The growing preference for platinum jewelry among Indian grooms reflects changing consumer dynamics and the impact of rising gold prices. While gold remains a popular investment choice, platinum’s appeal as a fashionable and distinctive metal is on the rise. This trend may lead to a broader range of jewelry offerings in the market, with jewelers and platinum manufacturers poised to benefit.
Proper Citation:
Author(s): Sutanuka Ghosal
Title of work: “Ditching Gold as Old, Indian Grooms Tie the Knot with Platinum”
Date of publication: Nov 28, 2023
Publisher: Economic Times (economictimes.indiatimes.com)
URL link: Read more