(Reuters) -Indian jeweller Tribhovandas Bhimji Zaveri reported its first drop in profit in ten quarters on Thursday as surging bullion prices led to higher demand for gold as an investment, instead of jewellery.
The company’s consolidated net profit fell 24.7% to 94.9 million rupees ($1.10 million) in the fourth quarter.
Gold prices increased by nearly 17% during the quarter, with the price of 10 grams of 24-carat gold exceeding 90,000 rupees ($1,052.26) by the end of March.
The demand for gold as an investment in India, the world’s second-largest gold consumer, jumped 7% to 46.7 tons in the quarter, according to a report from the World Gold Council (WGC).
But jewellery demand sank 25% to 71.4 metric tons, the lowest for any January-March period since 2009, the report said.
Tribhovandas Bhimji Zaveri’s total revenue from operations rose 4.5% to 5.29 billion rupees in last quarter, compared to a 9% rise in the same quarter a year ago.
Its expenses rose 4.8% to 5.17 billion rupees, pushed by a 34% increase in the cost of raw materials.
Earlier this month, Tribhovandas Bhimji Zaveri’s larger rival Titan posted a higher quarterly profit, as did Kalyan Jewellers.
The company’s shares closed 1.4% higher ahead of the results.
($1 = 85.9250 Indian rupees)
(Reporting by Meenakshi Maidas in Bengaluru; Editing by Savio D’Souza)
