Русский
Russia’s PJSC MGKL, the holding company of Russian pawnshop chain Mosgorlombard, is to establish a company in the GIFT City international financial center in the Indian state of Gujarat to enter the capital market, the company has announced.
The business model is to offer loans secured by gold in India. Initially, the group is considering installing automated terminals for contactless appraisal, purchase and sale of physical gold and silver. This would be a first for the Indian market.
MGKL CEO Alexei Lazutin said that “Considering the scale and maturity of the gold-backed loans market in India, we expect strong demand for contactless acceptance of gold items.” After registering in GIFT City, the company is considering issuing public capital market instruments.
MGKL secured a long-term local currency credit rating of B- on the international scale, with a stable outlook, from Indian ratings agency CareEdge Global in April.
The Group has several lines of business, including Mosgorlombard, as well as the wholesale purchasing and processing of precious metals under their Log-Zoloto NDS subsidiary, which buys scrap gold from pawnshops and jewellery stores, refines it, and resells the metal as wholesale gold bars. MGKL carried out an IPO on the Moscow Exchange at the end of 2023.
Gujarat’s GIFT City is an international financial services center with a simplified regulatory environment, tax incentives and opportunities to work with capital in more flexible infrastructure than under standard Indian jurisdiction. MGKL’s analysis of the India opportunity is very shrewd. Indian households and temples hold about 25,000 to 35,000 tonnes of gold, making them the largest private owners of gold on Earth. These private assets are worth up to US$2.4 trillion – bigger than the combined gold reserves of the world’s top 10 central banks.
