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Muthoot Exim Private Limited, the precious metal division of Muthoot Pappachan Group (MPG), has launched its first old gold aggregation outlet – Muthoot Gold Point – in Coimbatore.
The opening of this outlet marks the company’s foray into retail gold aggregation and recycling business, says Keyur Shah, Chief Executive Officer, Precious Metals Division, PMG.
The company plans to open a similar outlet in Chennai, followed by another in Madurai before the close of the current fiscal.
Lucrative market“We identified Tamil Nadu as a potential State for retail gold aggregation as South India accounts for 40 per cent of the country’s gold consumption and 70 per cent of this consumption is in this State,” he said in reply to a query. Elaborating on the new business, Shah said that the company’s objective is to cater to the burgeoning individual household need to recycle unwanted, old and used gold jewellery by buying the scrap or used jewellery items directly from the customers.
The new facility established by the company here would ensure transparency in purity, weight and valuation.
Market rates“We will offer the live market rate and not go by the fixed rate for the day. We have a national pricing policy,” Shah said. He said that India is one of the largest importers of gold in the world and already had an estimated stock of more than 25,000 tonnes in the custody of private households and temple trusts.
“All this is lying idle and our average import of bullion over the last eight years has stood at around 800 tonnes per annum.”
Idle holdings“If such idle holding is brought into the market, our dependence on import would decline drastically. Only 200 to 300 tonnes of used gold is recycled annually at present,” Shah said.
Muthoot Exim has tied up with Mumbai-based Infinium Precious Resources for refining scrap gold.
“They will help reprocess and refine the scrap, which can be supplied as refined bars for domestic consumption. By doing so, we will be able to supply ‘made in India’ gold bars,” he said, stressing the need for more refineries in India.
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