Jewelers turning developers
Numerous jewelers are exploring opportunities and diversifying their businesses within other verticals, due to the prevailing uncertainties in the gold front.
Even in the present slumping economic scenario, when developers who are traditionally involved within the sector are having a tough time, majority of these jewelers are majorly investing in real estate.
Reasons for considering Real estate:
This is being attributed as a long term investment. These jewelers believe that at the end of the day real estate is one of those asset classes which would not return high percentages of loss unless a drastic change in the market is observed.
Another point that is being made by these jewelers is that the present market possesses huge demands from end-users however it is the anticipation of a further slump within the segment that is keeping these demands from converting into sales.
The existing problems of real estate are home-grown. The recent RBI ban on various policies, introduction of the new Real Estate Bill, etc. which have all adversely affected the growth of the sector are internal or domestic issues of the country. Like any other issue, these too require some time before they are ironed out.
The recent Government imposed import curbs dulling the gold market along with the increase in remittances from abroad due to the depreciating rupee the jewelers perceive the situation apt for investing with the real estate sector.
The most important factor being that the major chunk of investors and promoters of jewelers are non-resident Indians (NRIs). A huge multitude of this chunk prefers investing either in gold or real estate, back home.
Jewelers involved:
Possessing several NRIs as either investors or promoters, Malabar Gold and Diamonds is pursuing its prospects within real estate along with property development. Some prime properties have been delivered across various South Indian towns and cities by the group. It’s future plans include the development of huge residential enclaves, corporate structures and shopping malls to be lunched pan India. The planned projects in residential and commercial sector over the next four years amount to an approximate 14.1 million square feet. Gitanjali Gems and Joyalukkas too are considering investing within real estate.
