my gold plan ppt (1)

Gold Price Historical Trends & Returns

Subscription Date 16-Dec-2008

Subscription Amount

Rs. 3000

Tenure 36 months

Total Subscription Amount

Rs. 1,08,000

17,991.1517,991.15

Gold Price Historical Trends & Returns

Year 1

Year 2

Year 3

TOTAL

Redemption Date 15-Nov-2011

Gold Rate in Rs/10gm (on redemption date)

Rs. 29,171

Average Gold Rate in Rs/10gm (for 3 years)

Rs. 18702.94

Illustration has been prepared using the price of MCX Gold Mini (995 purity) and are for indicative purposes only.

Avg. Gold Rate (Rs/10 gm)

Subscription Amt (Rupees)

Accumulated Gold (Grams)

14,834.0014,834.00 36000.0036000.00 24.268624.2686

36000.0036000.00 20.009820.0098

23,283.6523,283.65 36000.0036000.00 15.461515.4615

108000.00108000.00 59.739959.7399

17,991.1517,991.15

RETURNS – 61%RETURNS – 61%

Subscription Amount – Rs. 1,08,000Subscription Amount – Rs. 1,08,000 Current Valuation – Rs. 1,74,261Current Valuation – Rs. 1,74,26159.74GRAMS

Profit –Rs.66,261

Profit –Rs.66,261

Problems with Investing in Gold

Purity and Quality Trust and faith on Jeweller Steep rise in the price over the past few years Gold is considered auspicious and intrinsic but has low per capita

consumption Limited range of gold investment/ savings products available to consumers Lack of Human discipline in accumulation of Gold

Other market challenges

5

Expensive - out of reach for a common household

Price volatility risks over the short and long term

Physical security is a concern for lower SEC

Loss of making charges when selling jewelry

Scams and other fraudulent cases in gold schemes

Move from physical to paper investment

© 2012 RMPML and World Gold Council. All rights reserved. Proprietary and confidential.

However this also poses as an opportunity to Stimulate Interest & Demand For an Organised Savings In Gold In

India.

My Gold Plan - The Study

Confidential draft for discussion purposes only

MGP’s market potential is validated through a comprehensive research

18 months study conducted by the WGC with McKinsey and Eden McCallum

Including a three rounds of Consumer Research: Phase 1: 706 consumers (Quantitative & Qualitative); 9 Cities: Mumbai, Delhi,

Chennai, Ahmedabad, Pune, Trivandrum, Mysore, Rajkot, Amritsar Phase 2: 1,595 consumers (Quantitative & Qualitative); 12 Cities: Mumbai, Delhi,

Bangalore, Ahmedabad, Amritsar, Ludhiana, Lucknow, Nagpur, Madurai, Warangal, Erode

Phase 3: 20 Focus Groups in Mumbai, Delhi, Chennai & Pune

Trade Interviews Banks & NBFCs Jewellers

8© 2012 RMPML and World Gold Council. All rights reserved. Proprietary and confidential.

Research indicates very promising acceptance

Source: Quantitative research initiated by the World Gold Council, conducted by IMRB (WPP company)

More than 70% of the customers of researched channel partners are likely to invest in this scheme if offered by their respective channel partner

© 2012 RMPML and World Gold Council. All rights reserved. Proprietary and confidential. 9

The SolutionIn Association with

Presents

Existing Jewellery ProductsMy Gold Plan

• Price risk (savings in rupees not gold in majority of current schemes)

• Fragmented trade

• Most offer redemption only in jewellery

• Daily price averaging (very small ticket size purchases on daily basis)

• Universal access via multi-network model

• Redemption in coins

• Secure & credible

My Gold Plan solves current market challenges


What is My Gold Plan

Similar to conventional savings plans A medium to accumulate physical gold in small quantities at periodic intervals A customer puts aside a fixed sum of money every month The fixed sum then buys gold every trading day in that month Save gold through a process of daily rupee averaging of the price of gold over

a sustained period in time At the end of the term exchange in the form of Gold Coins

Features of MGP

START

12 24 36 48 60

6 months lock in

99.5 24 Karat Gold

Monthly InvestingDaily Averaging

Top-Up Any time any amount

Cheque /DD/ pay

order (min1000/-)

ECS Preferred (min1000/-)

Features of My Gold Plan

Who can Invest ? Resident Indian including minors, HUF & NRIs

Minimum Monthly Investment

Rs.1000 and in multiples of Rs.500 thereafter

Initial Investment Mode Cheque/DD/Pay Order

Tenure 12/24/36/48/60 months

A pure product 99.5% 24 Karat Gold

A transparent product Micro Gram Units – customers are credited up to 4 decimal points rounded down

Recurring Monthly Investment Mode

Cash/Cheque/DD/Pay Order/Direct Debit/Debit Card/ECS/NEFT/RTGS (10th &20th)

Implications of each payment cycle mentioned in separate note. This would be a function of the “clearing date” of the said amount

Daily Averaging

All "Clear Funds" from investments (Fresh / Monthly / Additional) will be invested in gold over the next 20 business days in equal tranches and Gold Micro Grams allotted at "Beginning of Day" prices declared by Reliance Money

Features of My Gold Plan

Gold Pricing Gold price (upto 2 decimal points) would be calculated and declared by Reliance Money for all business days

Administrative Charges 1.5% of Initial/Monthly Invested Amount is a non-refundable fee paid to the Central Entity towards setup/administration costs

Lock-in Period 6 months. (Redemption not allowed during loc-in period)

Termination Charges 2.5% Termination Charges on the invested amount

Process Monitoring & Safekeeping

The entire process of daily gold purchase will be monitored by a Trustee appointed by Reliance & WGC. The process will be audited on a monthly basis .The gold that is purchased will be then passed on to a Safekeeping Agency till the time of fulfillment

Fulfillment 99.5% Pure Coins

Fulfillment Locations Gold Coin Redemption at Reliance Money Branches

How does it work? Front Office

Client Buys MY GOLD PLAN

from us

Documents deposited in the CAMS centers or

our Branch offices

MGP starts at T+1 day

Client Receives 3SMS• APPLICATION• WELCOME ON BOARD• SMS on days of deposits

Balance available from

CAMS & Website

At the time Fulfillmentclient gets

Gold

How does it work? Back Office

Reliance Money

Precious Metals Quote Accepted Order

Placed

Bank Gives best rate

Transfer gold

Trustee

Safe Keeping Agency

Independent Auditor

Transfer gold

Client gives Cheque

Reach to be maximised via a wide range of distribution and redemption partners

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Reliance Gold

Other Reliance Capital

Companies

Fulfilment

Jewellery Stores

Distribution (examples)

Back-end Service

Provider

Banks - Bullion

Suppliers

Process Partners

Custodian

Reliance Money

Other

Coins


Benefits of My Gold Plan

Accumulation of Gold with small amounts over sustained periods for a larger grammage / meeting up with ones Investment and/or Savings goals or Objectives thought of like daughter’s wedding, etc.

Cost Averaging: Allows the customer to average his price on Gold over a period of time

Gold Rates Benefit: More grams credited when the price of Gold is low Guaranteed Purity: 24 karat with 99.5% purity Secure : Get receipts for every payment made by customer Gold Gram benefit: Credit of Physical Gold Grams in 4 decimals

rounded down Multiple Payment Mode: Cash/Cheque/DD/Pay Order/

Direct Debit/Debit Card/ECS/NEFT/RTGS

Daily Averaging 2000/-

A unique and attractive offer in the market

ProductMY GOLD PLAN Gold ETF Gold Fund

(Mutual Fund)NSEL

e-GoldPhysical Gold Coins Jewellery Grammage

Savings Scheme

ROI/ Interest Rates (annual)

approx. 20% (avg. annualized 10 year

returns)

approx. 20% (avg. annualized 10 year returns)

approx. 20% (avg. annualized 10 year returns)


returns)


returns)


returns)

Services Offered

Savings in Gold, SIPs - Daily Avg pricing,

Redemption in coins

Savings in Gold Savings in Gold, SIPs - Monthly

Avg Pricing

Trading in Gold Savings in Gold Savings in Gold, SIPs and eventual conversion to

jewellery

Entry Barriersnil, micro units possible DEMAT a/c, 0.5

gms unitnil DEMAT a/c, 1 gm nil nil

Cost of Acquisition/ Annual Fees

1.50% 1.00% 1.5-2% nil 2-15% making charges

nil

Redemption Choice

Coins Cash Cash Cash or Coins Coins Jewellery

Exit Load/ Redemption Charges

Mix of type redemption for coins (0.5 %)

nil nil 0.5% making charges for coin

redemption

2-15% making charges

15+% as jewellery making charges (coins

redemption not allowed)

© 2012 RMPML and World Gold Council. All rights reserved. Proprietary and confidential. 21

With Jewellers

• No Coins• No Interest Benefit• Making charges

additional 20%-40%

MGP - Partnering Opportunity

Confidential draft for discussion purposes only

Reliance Capital

Reliance Capital is India’s Third largest Financial Services Group Key Highlights:

Over 150 million customers - 1 in every 8 Indians 12 million shareowners - among the largest in the world 130,000 young, trained and motivated people Group net worth of over US$ 16 billion Group market capitalization of over US$ 27 billion Flagship stocks included in Sensex, Nifty, MSCI and Futures & Options


Reliance Money

Reliance Money pioneers in the Gold Coin growth story in India India Post is Reliance Money’s principal partner. The tie-up with India Post started in 2008 with 108 Post Offices in 3 states.

Since then it has expanded its reach over 1000 Post Offices in India across 21 states.

This growth was achieved due to an extremely robust Inventory Management system and constant innovation in our product offerings.

Through the Inventory Management system, Reliance Money manages over 1000 outlet’s stock and sales inventory on a real-time basis.

World Gold Council

World Gold Council (WGC) is a U.K. based market development organization of the gold industry, including global mining companies responsible for over 60% of corporate gold production.

In addition to using its influence to contribute to the development of the gold mining industry, the World Gold Council also works to develop insights into the future role that gold can play, and to increase and sustain the demand for gold in the investment, technology, and jewellery sectors.

WGC is an organisation funded by the world’s leading gold mining companies with the aim of promoting demand for the precious yellow metal.

World Gold Council

The WGC also works to increase and sustain the demand for gold in the investment, technology, and jewellery sectors

Examples of the WGC’s market changing initiativesGlobal Gold ETF: Current AUM US$ 90 bn ICBC China: Over 2.2 million accounts since launch 1yr ago Bullion Vault – Current AUM US$ 3 bn

India Akshaya Thritiya (45 tonnes) Banking Sector Gold Retail Programme (25 tonnes)

Partnered with ICICI Bank for the retail launch of Swiss certified gold medallions in India India Post Gold Retail Programme

Having catered to 150,000+ customers transactions and 800+ post offices Gold Linked Microfinance Schemes

Catering to 3.5 lac women customers via 1,400 branches in South India


WGC & My Gold Plan

WGC runs such program with various partners across the globe These partners are generally the financial front runners of the country To name a few:

China WGC has signed up with Industrial and Commercial Bank of China (ICBC) ICBC is the largest and most profitable commercial bank in the world It serves over 215 million individual and corporate clients globally Since the programs inception in March 2010, over one million accounts have already been opened

Japan WGC has signed up with 2 of the biggest Japanese financial entities

Mitsubishi Corporation & Mitsubishi UFJ Trust and Banking Corporation Mitsubishi Corporation is the largest general trading house in Japan It runs the largest gold trading team in Japan

Tanaka Kikinzoku Kogyo K.K. Group (TKK) Tanaka is the largest bullion house in Japan WGC has been running GAPs with the TKK group since 30 years

In India WGC has an exclusive tie up with Reliance

While there are a myriad of gold investment channels and products in the market, our research has identified over INR 35,000 crores of annual demand for a new product that can solve for the current market’s challenges

Distribution partners can easily meet this demand with My Gold Plan - a gold product that is: Affordable Flexible Secure Simple Transparent

29

An opportunity for a potential partner


Thank you