Gold ETF AUM rise in Gujarat over soaring prices, low jewellery demand

Time of India

02-06-2025

Ahmedabad: Physical gold demand took a backseat over the past 3-4 months due to soaring international prices and subdued jewellery demand. As a result, investors in Gujarat are increasingly turning to digital gold.
This shift has pushed the state's Gold Exchange-Traded Fund (ETF) assets under management (AUM) up by over 27% in the first four months of 2025.
Data from the Association of Mutual Funds in India (AMFI) revealed that Gold ETF AUM in Gujarat grew from Rs 681.53 crore on Jan 1 to Rs 867.49 crore on April 30. The increase was steady month-on-month, with April alone seeing a jump in AUM to Rs 867.49 crore, from Rs 828.51 crore in March.
According to industry experts, gold is certainly becoming an important asset class in investor portfolios given its gains over the past few years. "In merely five years, the returns on gold doubled, as a result of which many investors are turning to the digital form of the yellow metal, which enables them the flexible option of low-cost investment without having to worry about safety," said a city-based financial advisor.
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Gold prices in the Ahmedabad market settled at Rs 99,500 per 10g on Monday. Bullion industry players attribute this rise to a growing investor preference for gold as a financial asset rather than an ornamental one.
Haresh Acharya, director, India Bullion and Jewellers' Association (IBJA), said, "Ongoing geopolitical tensions have driven gold and silver prices sharply upward, prompting a clear shift in investor behaviour.
With gold prices consistently hovering above $3,300 per ounce, traditional retail demand has softened. More investors are now opting for Gold ETFs as the digital route offers ease of transaction, need for less compliance, and easy liquidity.
The market is moving in tandem with global cues, and this trend is likely to continue as long as price volatility persists."
Gold ETFs, which offer transparency, liquidity, and no storage hassles, have gained traction among urban investors, particularly in Gujarat's major cities such as Ahmedabad, Surat, and Rajkot. Market participants note that ETFs allow retail and institutional investors to take exposure to gold price movement without the need to deal with making charges or purity concerns.
(GFX sent to designers)
Box: Gold ETF Demand
Month AUM (in Rs cr) % Change
Dec (2024) 681.53 0.89
Jan (2025) 741.14 8.75
Feb 784.07 5.79
Mar 828.51 5.67
Apr 867.49 4.70
Source: AMFI