Handicrafts Corp begins hedging on bullion Futures

Another PSU has entered the arena of bullion Futures market. In a recent development, the Handicrafts & Handlooms Exports Corporation of India, a PSU under the ministry of textiles, has started hedging in bullion metals at the Multi Commodity Exchange.

According to the PSU officials, it has hedged Rs 13 crore (Rs 130 million) in gold and silver over the last one month.

The handicraft promotion agency, which also imports precious metals, booked six tonnes of silver worth Rs 11 crore (Rs 110 million)  and 20 kg of gold worth Rs 2 crore (Rs 20 million) on various contracts.

It is trading only for taking physical delivery and nothing else, said officials of the PSU.

It sells precious metals to its associates and sells BIS halmarked jewellery directly to its customers.

The corporation has also entered into silverware trade and organises exhibition-cum-sale in India and abroad.

In the current financial year, the corporation is planning to book about Rs 100 crore (Rs 1 billion)

worth precious metals, including gold and silver, on MCX.

The handicraft corporation has also set a target of importing gold and silver worth Rs 750 crore (Rs 7.5 billion) directly.

It has already achieved the import figure of Rs 600 crore (Rs 6 billion), and hopes to cross the target on the rising demand for silverware.

Of the average daily turnover of Rs 12,000 crore (Rs 120 billion) on MCX, precious metals form 55 per cent with giant corporates such as Suraj Diamonds, Auro Gold and Tanishq among active traders.

In the first half of November, gold prices showed high volatility, with international prices moving from well below $800 per troy ounce to more than $845.

On MCX, the near month gold Futures started the month at Rs 9,980 per 10 gm before scaling to a high of Rs 10,685, before falling to Rs 10,125 on November 12.