Best Gold Stocks in India

Where most people consider buying jewellery the go-to option for gold investment, you can multiply your benefits by developing an investor's perspective. That being said, following are the few popular ways to invest in gold in India: 

• Gold Stocks

• Gold ETFs and mutual funds

• Gold Futures Contracts

• Gold Coins

Here, you will learn how to invest in gold stocks. Simultaneously we will mention a few great performing stocks that have come to the limelight in recent years.

It even used to be one of the most preferred stocks of Mr. Rakesh Jhunjhunwala, who was considered the Big Bull in the Indian stock market.

2. Muthoot Finance Ltd

Muthoot Finance acts as a lender who provides secured personal loans to borrowers who pledge their valuable gold belongings to the company. This Kerala-based organisation does not deal with gold bullion and only accepts household jewellery as mortgage. 

3. Kalyan Jewellers

One of the newest additions to the Indian stock market exchange, the Kalyan Jewellers, listed its shares on 26th March 2021. Securing a record revenue of Rs. 10.8 Crores in the fiscal year 2021-22, Kalyan Jewellers successfully operates brands like Tejasvi, Laya, Anokhi and Rang.

Apart from gold, this company sells a variety of precious stones like ruby, diamond, sapphire, etc., across the country. 

4. Rajesh Exports

The primary business activities of Rajesh Exports include gold refining and exporting products like handmade jewellery, electro-formed jewellery and tube jewellery. In addition, they are also involved in the retail jewellery business under the name SHUBH Jewellers. 

5. Manappuram Finance Ltd.

The Manappuram Finance Ltd. operates as an NBFC that offers secured credit in the form of gold loans to those who fulfil their credit eligibility criteria. The credentials are simple, so people from lower economic classes can meet them easily. 

6. Vaibhav Global

The majority of this company's client base is from the U.K. and the U.S. Besides selling fashion jewellery, they also deal with home essentials and beauty products, thereby diversifying your investments further.

The drawbacks of physical gold are the main reasons why people are now investing more of their hard-earned money into gold stocks. In addition, buying gold stocks gives you the following benefits:

• Tax benefits: Your tax liabilities get reduced if you hold gold stocks for more than one year in your portfolio starting from an initial purchase. Thus you become eligible for long-term capital gains. Again, funds like the SBI gold loan are treated as a non-equity product that ensures an assured dividend income and capital appreciation over time. 

• Easy liquidity: Digital gold assets can be sold at the current market price whenever the rate seems justified to the holder. Moreover, there are no hidden charges or processing fees, and the selling amount gets transferred to your account through a secured gateway. 

• Hedge against inflation: Investors recommend including gold stocks in a person’s investment portfolio as, historically, it has recovered losses from low-performing sectors in the stock market. Getting reasonable profit from the gold investment options can eventually help you beat inflation. 

• Small capital requirement: Gold stocks are not as expensive as bonds, allowing a budding investor to start small. It is always advised to bring in additional funds for investment once you become more familiar with this instrument.

Clients who do not own a Demat account can still buy digital gold by investing in gold funds. The fund managers keep track of well-performing ETFs in the market to execute successful purchases. Hence, as a retail investor, you become free from the hassle of choosing ideal companies to buy unit stocks.

Regardless of the advantages mentioned earlier, many prefer to choose gold ETFs as their favourable investment instrument. Therefore, one must gather a clear idea on the topic of gold ETF vs gold mutual fund. 

In contrast to gold funds, exchange-traded funds or ETFs are passively managed and comprise 99.5% pure gold as their financial product. Here, if you buy 1 unit of any gold ETF, it implies that you are now the owner of 1 gram of gold. Also, you need a Demat account to hold ETF belongings.

• Consult an expert: Most retail investors skip this step as it involves additional costs in the form of fees charged by the financial expert. However, hiring one can help you earn optimal returns. 

• Plan an investment strategy: Retail investors can buy gold stocks by choosing any of the three methods: gold ETS, mutual funds or investing in companies. Each method has pros and cons; hence, personal research is mandatory to determine which way suits your investing nature.

• Start small: Instead of setting aside a hefty sum well in advance, consider starting with modest investments, as volatility in the gold market can be overwhelming for beginners. 

• Learn about the tax implications: Gold stocks are considered non-equity products; hence investors enjoy the benefits of long-term capital gains. 

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