What Delivered Better Returns Than Gold During Volatility? Gold Stocks
Over the past 52 weeks, shares of jewellery companies have surged up to threefold.
Gold is considered a safe have in times of market and economic volatility, as seen over the past year. Still, over the past 52 weeks, shares of jewellery companies have outpaced the yellow metal.
As the second most imported commodity in the country, gold contributes to the nation's rising trade deficit. To address this issue, the government introduced an import duty of 15% on gold.
Bullion price has jumped form Rs 51,300 per 10 gm on July 31, 2022 to Rs 59,500 as of July 26 close this year.
But with markets rallying since the beginning of the current fiscal, gold has been outrun by stocks of companies processing the yellow metal.
Shares of jewellery companies have surged up to threefold over the past 52 weeks compared with a 20% returns on gold at its peak.
Shares of Kalyan Jewellers Ltd. rose as much as 197% during the 52-week period, while Thangamayil Jewellery Ltd. saw a rise of over 128%. Titan Co. jumped 61%, while Tribhovandas Bhimji Zaveri Ltd. rose 41% during the period.
That compares with a 16% rise in the benchmark Nifty 50.
