00:00Namaskar, my name is Digvijay Singh. Welcome to Good Returns.
00:04Today we will talk about gold.
00:06Because there is Dussehra, Dhanteras, Diwali and after that there is the season of weddings.
00:10In such a situation, what are the predictions about the prices of gold and silver?
00:14Will the prices fall in the coming days or will they continue to rise?
00:18We will understand all this.
00:19Today we have joined us for a special conversation
00:22Mr. Manav Modi from Motilal Oswal Financial Services.
00:26Mr. Manav, welcome to you.
00:30Thank you for inviting me.
00:32Happy Navratri to all of you.
00:35To you too.
00:36First of all, we will understand what is going on in the bullion market these days.
00:42It is continuously increasing.
00:44What is exactly happening?
00:46As an expert, what are you seeing in the bullion market?
00:48What is the movement?
00:49Where is the enthusiasm coming from?
00:51Please tell us.
00:52Yes, absolutely.
00:53I think if you see this whole year, there has been a taste of gold.
00:57If you see, it is called a safe haven asset.
00:59It looks like a year of safe haven.
01:01If you talk about the comics chart in the international market,
01:08then in the monthly chart, there are only 2 candles where there is a red closing.
01:14And that too of minor dips.
01:16It has been 9 months and all the candles are almost green.
01:20If we remove the duty cut portion in M6, then it is going very well.
01:26If we look at the percentage terms, then in the comics, gold is 30% higher.
01:31Similarly, on the domestic front M6, we saw a movement of around 20%.
01:36We can say that it is a historic run because gold is moving very well from the average run.
01:42So, the excitement that is seen in gold and silver,
01:45how much will it give taste to our buyers in the festive season?
01:49Now, there is Dussehra and Diwali ahead.
01:52Then the season of weddings will start.
01:55So, first of all, what level are you looking at for Dussehra and Diwali?
02:01If we look at some factors around Diwali and Dussehra,
02:08recently the Fed announced a rate cut of 50 basis points.
02:13In November, there are US elections.
02:17So, in the beginning of November, there are US elections and Fed meetings.
02:21In the US elections, the rate cut of 25 basis points is already factoring in.
02:27In this year, there are two Fed meetings, one in November and one in December.
02:33So, in both, the rate cut is very strong.
02:36Secondly, if we look at geopolitical tensions, they are continuously increasing.
02:40So, there is support for that as well.
02:42If we talk about returns, if there is a movement of 20% in the domestic front,
02:47then there can be a drop in profit bookings from that 20% till Diwali.
02:53And from there, there can be a rally again by the end of the year.
02:57So, I think 74-800 will be a very good level.
03:0274-500 and 74-800 is a very good range to buy on an immediate basis.
03:07And if we look at the upside from here,
03:10the immediate gains from this year can be a little limited.
03:14Because we have seen good gains.
03:16And if we see a rally again in the next year,
03:18then immediately 77-200 is a very good level,
03:23as far as gold is concerned, we can see till this year.
03:27So, this was about Dashera and ARN.
03:30If I look at the start of the wedding season,
03:32will there be an increase in the prices?
03:34You are saying that there is a little concern.
03:36So, will there be an increase in the prices during the wedding season
03:40or will there be a drop in the profit bookings in gold?
03:45I think profit bookings are warranted.
03:47Because if you look at any asset, be it equity, gold, silver or any other asset,
03:52a one-way rally does not give any asset.
03:55And if there is a one-way rally, then it can be a little scary.
04:00But after a one-way rally, there is a slight drop.
04:04So, it is a good thing for all the market participants.
04:07And it seems that there can be a slight drop in gold as well.
04:11But definitely, we have come to a very high range.
04:14So, if I talk about a fall of Rs. 1000,
04:17then it may not have such an impact in the physical market.
04:21But definitely, if we talk about MCA, ETF or any other investment terms,
04:26then we can play a larger margin of Rs. 1000 fall.
04:30So, this Fed, the Central Bank of America,
04:33there and the meetings of RBI,
04:36apart from these triggers,
04:38what other triggers will be seen, especially in the bullion market,
04:41if we talk about the global and domestic front?
04:43Yes, definitely.
04:44I think you have talked about RBI.
04:46RBI is the only major central bank.
04:49If we keep Fed, ECB and BOE in the list,
04:53then RBI is the only central bank that has not yet announced a rate cut.
04:57And it is also profitable.
04:59Because if you see, both inflation and growth have to be balanced.
05:03So, growth concerns were increasing in other countries.
05:06India's growth concerns are not so much.
05:10Keeping inflation in check, the RBI governor has taken that stance.
05:14We have to see that USDINR has depreciated by 1% this year.
05:20Now, if there is a rate cut,
05:22then we may get the impact of that depreciation on the domestic front.
05:27That is one factor.
05:29The second factor is, apart from Fed,
05:34geopolitical tensions are at the forefront.
05:37Especially in the Middle East, Israel, Hamas and neighboring countries like Iran,
05:42if their trend escalates,
05:45with the intervention of the US and other countries,
05:48then it can be a big matter that can take gold to the next level.
05:54Mainly, if we see, there are only two big factors.
05:57The movement of central banks and the escalating tensions in the Middle East.
06:03Sir, if we talk about the domestic front,
06:06the RBI's MPC meeting is still going on.
06:08The decision will be made on 9th October.
06:10The assumption is that this time also,
06:13for the 10th time, the exchange rates can be kept stable.
06:16We will not depend on the decision,
06:19because the assumption is that it will remain stable.
06:22But how much impact will the commentary have?
06:25Because I feel that in the coming days,
06:28The experts are also saying that in the next policy meeting,
06:31the RBI can start reducing the interest rates.
06:34How do you see this move in terms of the bullion market?
06:39I think it is important to keep two things in mind
06:43when we talk about interest rates or any central bank.
06:46First, how they are forecasting inflation and growth.
06:50Even if they keep the interest rates unchanged,
06:53but if they forecast less or more,
06:57then it will impact the market more.
07:02Secondly, if we talk about imports and overall deficits,
07:10this year's import of gold and silver was very good.
07:17The import of 400 tonnes of gold has increased to more than 400 tonnes in 9 months.
07:22The import of silver has also increased to more than 5000 tonnes.
07:25So this import duty can definitely have an impact somewhere.
07:30But how will it affect the overall deficit?
07:33It is also important to see how the balance sheet of India will change.
07:40That's why I think the market is anticipating a change in interest rates.
07:46But as I said, inflation is in control.
07:50But our GDP is stable.
07:53So I don't think RBI should cut the interest rates.
07:56So these were the factors.
07:58Now if we ask our viewers,
08:00as it is a good time to invest in gold,
08:06as gold is very expensive now,
08:09what advice would you give to retail investors?
08:12Which option should they go for?
08:16What advice would you give?
08:18Which option should they focus on?
08:21I think we have a diverse platform for investing in gold.
08:28Until recently, we had SGB as an option.
08:32If I talk about active options,
08:35ETF is a very good channel where we can invest.
08:39There is a little flexibility.
08:41There is a derivative market on the M6 platform.
08:44Thirdly, there is a physical market.
08:47We can diversify the portfolio according to our risk profile and capital.
08:56There are some added costs in the physical market.
09:00As you mentioned, there will be a wedding season.
09:03So jewellery is nothing better than physical.
09:07So purely in terms of investment,
09:09the derivative is on the M6 platform.
09:11Or ETF is a much better platform.
09:14That's right.
09:15So if we look at gold and silver,
09:19we can see an increase in gold as well as silver.
09:23What level can you see in the future?
09:25If we talk about the festive season,
09:27till Dussehra and Diwali,
09:29what level can you see for silver?
09:31What is the current industrial demand for silver?
09:35What level can you see for retail investors in the coming days?
09:41The rally in silver has started quite late.
09:47We were thinking that silver will increase its hold.
09:53We saw the 35% rally on the YTD basis in the comics.
09:59I think the fall in silver is fast.
10:05The rise is also fast.
10:07The level I am seeing from here is 88-500 on the immediate basis.
10:13I think that is a very good support.
10:16If it reaches there, it will be a very good level to buy.
10:21Whether it is on the M6 or in the physical market.
10:24If we talk about the end of the year,
10:28the all-time high is around 97,000.
10:31We can see a closing there.
10:33We have also released long-term reports.
10:43I think we can discuss those levels as well.
10:46If I talk about both metals,
10:50what will be your top pick for long-term?
10:52Will it be gold or silver?
10:54Which metal do you trust more?
10:56If you are looking at the time frame of 1-2 years,
11:02incrementally, the gains in gold,
11:05we have seen very good gains this year.
11:07But in silver, my bet will be more.
11:10I think either gold or silver can see more returns.
11:15In all these years, silver has performed as good as gold.
11:20But we have not seen any outperformance.
11:23Industrial metals, China's speed,
11:25and China's support for silver can be seen in silver in the long term.
11:32For next Diwali, what is your target for gold and silver?
11:36For next Diwali, if we want to know,
11:38at what level are you looking at gold and silver?
11:44Will there be a new record?
11:46In short term, there will be a correction.
11:50But what is your vision for long term?
11:52Especially for next Diwali.
11:54If we are talking about next Diwali,
11:59we have a target of 81,000 in gold.
12:03We have released it recently.
12:08If we talk about silver,
12:10there is an immediate view of 1,00,000-1,15,000.
12:15We have an in-house view of 1,25,000.
12:17But if you reduce the duty by 9%,
12:21then it definitely comes close to 1,15,000.
12:24We see silver above 1,00,000 for next Diwali.
12:28And we see 81,000 in gold for next Diwali.
12:31So according to Mr. Modi,
12:33in short term, we can see a correction in gold.
12:36But for long term, we can see both gold and silver.
12:40Mano sir, thank you very much for connecting with us.
12:43Thank you very much sir.
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12:55Namaskar.
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