Analyst's Diary: Diamond market sparkles with new opportunities

Despite its skyrocketing prices, the yellow metal remained in demand among Indian consumers. However, diamond jewellery makers had a different story to tell. Poor demand The US is the primary source of revenue for diamond merchants in India. Post-Covid, the demand for diamond jewellery in the US spiked quickly, followed by a slump since 2022, owing to inflation. Subsequently, diamond prices corrected by around 10-15 per cent. Naturally, diamond jewellery makers in India faced the brunt of this. But things seem to be changing for the better now. Light at the end of the tunnel? Signet, one of the world's leading retailers of diamond jewellery, stated that demand for diamonds is now on an upswing. Anticipating the surge, many small retailers overstocked diamond jewellery post-Covid. Unfortunately, the market demand did not follow up. Since then, retailers have been selling their existing stocks at high discounts. However, Signet believes that this trend has ended. This was proven true when we looked at the cycle-wise sales numbers of De Beers, one of the world's largest diamond mining companies (it provides sales numbers in cycles based on auctions).