Gold Crush
Everybody knows gold has a return value and its price is calculated based on the number of tolas (10 gm). One tola can even cost Rs 18,000 on a given day. And here’s a little secret: While 22 carat gold is usually used for making plain gold jewellery or exquisite sets inlaid with rubies and other gemstones, you never use 22 carat to create diamond jewellery — it has to be made in 18 carat gold as 22 carat gold is too soft to hold the diamonds in place.
If you are bored with your existing sets and want to opt for a change, you could sell your jewellery at any gold store in exchange for another piece. But the “buy back” rate varies from store to store, based on the purity of your gold. “Tanishq has adopted the modern and accurate method of testing gold by using a carat meter,” says Babu, manager of the T. Nagar Tanishq branch, Chennai.
The buy back rate is then fixed according to the current price of gold and you are paid only for the percentage of ‘pure’ gold in your jewellery. But here’s a word of caution, while buying gold jewellery, the making charges are included in the price of the item, but when you sell your piece, you will only recover the value of the gold as per the current market price. The making charge that you paid is the main loss that you incur. Some jewellers deduct between 1-3 per cent of the value when they buy back gold from customers to cover the loss incurred due to melting, wastage or impurities. Consumers also pay extra when they want a piece modified as they have to pay for any additional gold used and making charges.
It is a popular myth that stones do not have resale value. But jewellery stores claim that diamond has resale value based on the quality of the stone, while the other coloured stones don’t usually have resale value. For instance, if you want to sell a ruby-studded gold pendant, which has gold worth Rs 1,000 and rubies worth Rs 500, you may get only the money for the gold, i.e. Rs 1,000. However, certain stores may offer you a small amount based on the quality of the stone or your jewellery pattern.
In order to lure customers during this auspicious season, many jewellers offer great discounts. Karan Jethwani, director, Meena Jewellers, says, “We have offered up to 75 per cent discount on the making charges. During festivals, we have also lowered prices of the gold — selling it at Rs 1,609 per gm when the market rate was Rs 1,807 per gm.”
Jewellers like Joy Alukkas and Meena Jewellers buy gold coins issued by banks provided they have the certification and use the value of the coin as advance against jewellery ordered or bought at the shop. But Vasudeva Rao, the area business manager for Tanishq in Hyderabad says, “We have found that in some cases, the coins from banks do not have 916 purity (the grade of 22 carat gold considered as pure) so we have it melted and test for purity with our carat meter and only then do we place a value on it.”
With inputs from Minal Khona, Vidya Addhepalli, S. Umamaheshwar
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