India’s overall gems and jewellery industry market size is around $78.5 billion with the US export market being the primary driver of global demand. For FY22, this market's export touched $39.14 billion. Over the next five years, the target is to take this figure to $70 billion.
Among this, India’s diamond trade contributes about 7% to India’s GDP and 10% to India’s total merchandise exports.
The Government of India has initiated certain steps to boost exports of diamonds and other gems and jewellery. India has signed an FTA with the UAE to boost exports to $52 billion. The revised SEZ Act is also expected to boost exports of gems and jewellery.
Government reduced custom duty on cut and polished diamond and coloured gemstones from 7.5% to 5% and nil. Diamond exports will also get an indirect boost from reforms like revamped gold monetization scheme, reduced import duty on gold, hallmarking, etc.
The Indian government’s declaration that the gems and jewellery sector is a focus area for export promotion makes it relevant to focus on the best diamond stocks in India.
The best diamond and jewellery sector stocks to invest in India are:
Titan: It is an India-based consumer lifestyle company. The company is primarily involved in the manufacturing and sale of watches, jewellery, eyewear, and other accessories and products. The jewellery segment includes brands such as Tanishq, Mia, Zoya, and CaratLane.
Kalyan Jewellers: It is an India-based jewellery retailer which is engaged in offering gold, diamond, pearl, white gold, gemstone, platinum, and silver jewellery products. The company’s brands include Mudhra, Anokhi, Rang, Vedha, Tejasvi, Apoorva, Ziah, and Glo. It has approximately 150 retail stores across India and Middle East.
Rajesh Exports: It is an India-based gold refiner and manufacturer of all kinds of gold products. The company has retail showrooms under the brand name, SHUBH Jewellers. It has manufacturing facilities in India and in other countries including Bangalore, Cochin, and Dubai.
Senco Gold Ltd: This India-based jewellery retailer primarily sells gold and diamond jewellery and also sells jewellery made of silver, platinum, and precious and semi-precious stones. The company’s products are sold under the Senco Gold & Diamonds trade name, through multiple channels, including approximately 70 company-operated showrooms and 57 franchisee showrooms.
Thangamayil Jewellery Ltd: This company is primarily involved in the manufacturing and sale of jewellery and other accessories and products. It is engaged in the business of gold, diamond, and silver articles, mainly. It operates around 54 retail showrooms out of which 13 are exclusively for silver.
PC Jeweller Ltd, Goldiam International Ltd, Renaissance Global Ltd, Tribhovandas Bhimji Zaveri Ltd, Sky Gold Ltd, etc. are some of the other popular names in the diamond and jewellery sector of India.
The outlook of the diamond sector is bright in India since it still accounts for 90% of the diamond, polishing in the world. However, currently, they are facing a shortage of rough diamonds due to the ongoing war in Russia, which happens to be the biggest supplier of rough diamonds to India.
The macroeconomic challenges at play have led to a decline in demand for natural diamonds. ICRA Ratings expects India’s exports of cut and polished diamonds (CPDs) to taper by 8-10% to $22.0-22.5 billion in FY2023, amid moderation in demand and a fall in disposable income in key markets.
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