Jewellery shares shine after RBI eases norms
Shares of jewellery maker such as Gitanjali Gems, Tribhovandas Bhimji Zaveri (TBZ), PC Jeweller, Rajesh Exports and Titan Company are trading higher by up to 5% on reports that the Reserve Bank of India on Wednesday allowed nominated banks to provide gold on loan to jewellers.
The central bank also said there would be no restriction on import of gold coins, although commercial banks will still not be allowed to sell these in the home market.
This opens the gold import route further and addresses the liquidity crunch of jewellers, who were made to pay the full amount for buying gold since mid-2013.
RBI has said sale of gold to jewellers will have to be against full payment only. Jewellers will, however, prefer to take it on loan rather than purchasing outright. Banks were importing much less gold since removal of the 80:20 scheme in end-November.
Among the individual stocks, Gitanjali Gems has rallied 4% to Rs 57 on BSE. PC Jeweller is up 4% at Rs 253 followed by TBZ (2% to Rs 179), Rajesh Exports (2% at Rs 178) and Titan Company (2% at Rs 438).