Investors in India are bullish on silver, saying the white metal is in
position for a potentially spectacular move over the next year and more.
Author: Shivom Seth
Posted: Tuesday , 11 Dec 2012
MUMBAI (Mineweb) -
Indian retailers are bullish on silver. With supplies tightening, deliveries
are slowing down this week in the bullion market in Mumbai. What has also
buoyed sentiment is that silver continues to lead precious metals, and sales
have jumped over 24% this year.
Snapping a two day losing trend, both the major
precious metals, gold and silver, bounced back in the Mumbai market on buying
by retailers at existing low levels. While gold rebounded to $575 (Rs 31,205) per 10 grams (US$1788/oz),
silver gained by 1.38% to $1,159.49 (Rs 62,930) per
"Strong support is expected in the Silver March contract around $1,159 (Rs 62,900) ($36.05) from the start of the week,"
said analysts tracking the white metal. Traders have been taking long
position in the Silver March contract above $1,161.49 (Rs
63,050) ($36.13) for target near $1,178.88 (Rs
64,000) ($36.67) for this week, they added.
Silver prices have remained steady at around $32 since mid-May. "Though
everybody has been gushing about the returns that gold has given over the
past four years, it is the white metal that has streaked ahead," said Manjusha Madani, bullion
analyst at an investment house.
She added that silver prices have jumped from $304.39 (Rs
16,525) per kilo ($9.47/oz) in 2008 to $1,381.95 (Rs 75,020) per kilo ($42.98) in 2011, a gain of 354%.
Though prices have dropped per kilo, it does not mean that the potential in
silver is exhausted, she added.
An analyst report had also shown how silver had risen about 53% from December
2008 through March 2010, twice as much as gold. Silver is expected to keep
"More and more people are realising the value
of investing in silver coins and bullion bars in India," added Jayeshbhai Shah, a bullion retailer at Mumbai's Zaveri Bazaar. "The value of silver has increased
rather steadily for the last few years. People who have never invested before
are now investing in silver, because they know that buying silver is a great
way to ensure that their money is there when they need it," he added.
"The white metal is now turning out to be the preferred choice for
everyday wear, with exquisite silver jewellery on
offer, because gold is too expensive. Besides being trendy and contemporary,
the metal readily blends with a variety of clothing and other accessories,
thereby offering a suite of options to the wearer," said an official at Dhanabhai Export House.
He added that more and more consumers were looking for traditional or
contemporary silver jewellery and were even looking
at the white metal for classic business gifts, to be given during the festive
"There are customers who comes to us asking us for heritage art, or even
our temple jewellery selection, which is only made
in silver. We take great pride in preserving our heritage craft and have
several jewellery items that are exact replicas of
antique temple jewellery," he added.
During 2011-12, silver jewellery exports grew to
44% as compared with gold jewellery exports of 30%.
India is the biggest consumer of white metal jewellery,
and has also found a new class of buyers in the West.
Ketan Shroff, managing
director of Pushpak Bullions said investors and jewellery-lovers prefer silver jewellery
these days, as gold prices are going up constantly. Silver prices are
expected to rise further, if one takes into account the demand potential.