Have 100 sovereigns? You’re a crorepati! Malayalis hold gold worth ₹25 lakh crore

Kochi: With gold prices surpassing the magical mark of ₹1 lakh per sovereign, individuals with huge gold holdings have become millionaires and even billionaires. Owning 100 sovereigns now translates to assets worth Rs 1 crore. Kerala and Tamil Nadu are the primary gold markets in India.

Unofficial estimates suggest that households in Kerala hold around 2,000 tonnes of gold, equivalent to 200 crore grams. When calculated in sovereign, this amounts to 25 crore sovereigns. At current rates, the total value comes to approximately ₹25.40 lakh crore.

According to Reserve Bank of India data, India’s official gold reserves are estimated at around ₹880 crore. This means that the gold held by Malayalis is more than twice the national reserves. A major portion of this gold is kept in bank lockers, while other amounts are pledged in banks and non-banking financial institutions. Even when redeeming pledged gold, substantial quantities remain in circulation.

From 18 Carat to 9 Carat

As gold prices have surged, many have shifted from 22-carat gold to 18-carat, 14-carat, and 9-carat jewellery. The prices drop proportionally compared to 22-carat gold, but even these lower-carat items have reached new highs.

18 Carat:

• Per gram: ₹10,440 (+₹180)
• Per sovereign: ₹83,520 (+₹1,440)

14 Carat:

• Per gram: ₹8,130 (+₹140)
• Per sovereign: ₹65,040 (+₹1,120)

9 Carat:

• Per gram: ₹5,245 (+₹90)
• Per sovereign: ₹41,960 (+₹720)

Prices expected to rise in coming years

Gold’s global credibility and status as a safe investment have pushed international prices up by around $2,000 over the past year. Gold prices continue to rise beyond predictable limits. With structural shifts positioning gold from a commodity to a ‘global currency,’ it would not be surprising if prices reach $6,000–8,000 per ounce in the coming years, says Adv S Abdul Nasser, State General Secretary of the Gold and Silver Merchants Association.