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Informist, Monday, Apr. 21, 2025

 

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--Intl Gemmological Institute: Impact of US tariffs on co's svcs seen minimal
--CONTEXT: Intl Gemmological Institute mgmt comments in telephonic interview
--Intl Gemmological Institute: See major momentum in lab-grown jewellery ops
--Intl Gemmological Institute: Diamond industry seen growing tremendously
--Intl Gemmological Institute: Issues around 6 mln jewellery certificates/yr
--Intl Gemmological Institute: See revenue rising 15-20% over next 3-5 years

 

By Ashutosh Pati and Anjana Therese Antony

 

MUMBAI – International Gemmological Institute (India) Ltd. sees minimal effect of US tariffs on the company's services. "The impact of 10% on lab-grown (diamond services) is not much...will be absorbed either by the consumer or by the manufacturer or by the retailer," Chief Executive Officer and Managing Director Tehmasp Nariman Printer said in a telephonic interview with Informist.

 

International Gemmological Institute--which certifies diamond, colored stone, and jewellery--has more than 20 laboratories in India and a total of 31 across the globe, having presence in at least 11 countries, including the US, China, Hong Kong, and Italy. The company also supplies 95% of all polished diamonds in the world, according to an investor presentation the company released Monday.

 

Meanwhile, there is a shortage of rough diamonds because of the war between Russia and Ukraine. Alrosa, Russia's state-run diamond mining giant, accounts for 30-35% of the rough diamond supply and is under sanctions by the European Union. However, Printer said that the situation will improve even though there is a little bit of a slowdown in the natural segment.

 

The rising popularity of lab-grown diamonds does not affect the demand for naturally grown ones. Both types of diamonds are complementary to each other and are expanding the diamond as well as jewellery markets, Printer said. "With the affordability factor, more and more people will satisfy the desires with having an actual diamond," Printer added. India is a manufacturing hub for diamonds and had 95% of the market share in global diamond polishing in 2023. It is also the second biggest lab-grown diamond producer globally and has a 35% market share in the global production.

 

India's gems and jewellery exports in 2023-24 (Apr-Mar) declined by 13.8% on year to $32.85 billion from US$ 38.11 billion, according to the Ministry of Commerce and Industry's FY24 annual report. This was due to the sluggishness in the US economy, higher inflation, Russia-Ukraine conflict, and the slump in demand for diamonds in China, the ministry said. Adding to the woes are US tariffs under President Donald Trump, which have been causing volatility across global financial markets as US levies imposed are much higher than what the market as well as the US Federal Reserve had expected. However, the latest 90-day pause on all countries except China has provided near-term relief for most countries, including India. 

 

India's diamond industry is expected to grow tremendously as lab-grown diamonds are gaining more traction due to their affordability, Printer said. He also said that the company issues around 6 million jewellery certificates a year and is expected to grow much higher. The company's total report volume was 2.78 million in Jan-Mar, posting a 27% on-year growth. 

 

The company also said that volatility in the Indian rupee has not majorly affected the company as its services are more or less priced in US dollars. "...rupee volatility is there, I am not denying that. But our pricing is more or less in US dollars which is very stable," Printer said. 

 

International Gemmological Institute also re-iterated that its revenue should grow 15-20% over the next three to five years, similar to the 20% growth registered in the past six to eight quarters, driven by lab-grown diamonds service segment. "We are seeing a significant momentum coming in lab-grown jewellery segment...We expect to mirror the industry and stick to the guidance we have given from the long-term perspective," Chief Financial Officer Easwar Subramanian Iyer told Informist. 

 

The company posted an over-12% on-year growth in its top line for the March quarter to INR 2.34 billion and a 11% rise in net profit to INR 1.39 billion. The market cheered this financial growth, pushing the stock price 5% higher Monday to its upper band of INR 370.95 and then closing at INR 369.20 on the National Stock Exchange. Though most earnings metrics of the company, which follows Jan-Dec financial year, doubled in 2024 from 2021, its share prices have fallen nearly 28% since its debut on exchanges in December 2024.  End

 

US$1 = INR 85.12

 

Edited by Deepshikha Bhardwaj

 

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