Billionaire says gold could reach Rs 15 lakh per 10 grams

The fall in the gold market over the past few months has left investors confused, with many asking whether the rally in gold prices is over. Amid this, a statement from Thomas Kaplan, chairman of Electrum and a well-known billionaire, has stirred fresh interest in the market. Kaplan says gold's journey is far from over and could rise nearly 10 times its current price over the long term.

According to Kaplan's long-term analysis, gold in the international market could touch highs of 30,000 dollars, 40,000 dollars and even 50,000 dollars per ounce in the coming years. Gold is currently trading at around 4,600 dollars per ounce internationally, while in the Indian market, the price of 10 grams of gold is hovering around Rs 1.5 lakh.

If the international price reaches 50,000 dollars an ounce and the rupee-dollar exchange rate is taken at Rs 95, the price of 10 grams of gold in the Indian market could go up to Rs 15 lakh. However, Kaplan has not given any fixed timeline or date for this sharp rise. He says there could be more volatility or a further fall in gold in the short term, but it is almost certain that both gold and silver will make big gains in the medium and long term.

Offering reassurance to investors worried by the current fall, Kaplan cited the example of the 1987 stock market crash. On "Black Monday" in 1987, the US market saw a sharp fall of around 36 percent. That crash seemed frightening at the time, but on today's long-term charts it appears as just a small blip. According to Kaplan, the sharp fall in gold and silver is not a sign of fear but of a historic buying opportunity. Just as the panic of 1987 later turned into a golden period, a similar opportunity exists now. The only difference is that investors will have to endure sharp volatility along the way.

According to Kaplan, this long-term figure of Rs 15 lakh will depend on some major economic factors. These include the steadily rising gold purchases by central banks of different countries around the world, geopolitical conditions such as wars and trade tensions, the interest rate policies of the US Federal Reserve and other central banks along with rising inflation, and a possible fall in the rupee against the dollar.

Kaplan's prediction is based on a broad economic outlook rather than any short-term trading target. Buying gold as a safe long-term investment for a portfolio is always considered beneficial. Investing a little at a time during every downturn, in an SIP-style approach, could also prove beneficial.