Rough Waters For India’s Diamond Stocks

The Diamond Chain Rupture Is Showing Up In India's Listed Equity

By Dev Chandrasekhar

The collapse of the natural diamond trade is the most consequential industrial story unfolding in western India this year, and the listed-equity universe in Mumbai is now telling you a coherent version of it if read across twenty names.

Surat polishes nine of every ten diamonds traded globally. Its export book to the US has fallen by over 60% in the run-up to the India-US interim trade framework of February 7,  2026, from $3.64 billion to $1.45 billion. 

The price of a lab-grown diamond is now roughly a quarter of what it was in 2015, and synthetic stones were used in nearly half of the US engagement rings sold in the first eight months of 2025.

Across that backdrop, India’s diamond-related listed companies refract the shock into four distinct cohorts. Each cohort is absorbing a different part of the rupture; the pattern across them tells you more about how the Indian capital market is processing the crisis than any single company filing does on its own.

For a hundred years, the diamond business ran on a single architectural idea that scarcity could be manufactured even when the underlying mineral was not particularly scarce. 

De Beers mined the stones in southern Africa, sorted them into sights, and released them into a polishing chain that ran through Antwerp, Belgium and, from the 1970s onward, increasingly through Surat in Gujarat, India. Buyers were taught, over generations of advertising, that a diamond was a store of value rather than a piece of carbon.

That price floor has now given way, from a direction the cartel did not control. The Henan province in central China, once an agricultural belt better known for cattle and peppers, produces about half of the world's lab-grown diamonds, with 80% of Chinese output concentrated in a single county, Zhecheng. 

Anglo American, a British multinational mining company that holds 85% stake in De Beers, has written down the book value of De Beers in three consecutive years, from $9.2 billion in 2023 to $2.3 billion at the end of 2025. 

The diamond miner posted a $511 million underlying loss for the year, and Anglo is trying to sell the business. The Surat Diamond Bourse, opened in 2023 at a cost of approximately $350 million, is now about 95% empty.

What Does This Mean? 

The clearest negative exposure sits at the polished-natural-diamond manufacturer-exporter layer. Asian Star Co. Ltd is the most visible listed proxy for the pure Surat polishing-and-export model, with rough in, polished out, and US wholesale on the demand side. Goenka Diamond and Jewels is also in the same category. 

The cohort is thinner than it looks, however. Several historically large listed names are no longer functionally tradable: Gitanjali Gems, Winsome Diamonds and Jewellery, Su-Raj Diamond Industries and Shrenuj & Company are variously delisted, suspended, or in resolution. 

The fragility of the natural-stone polishing model has been pricing out of the listed cohort for years, leaving the index thinner each cycle. What remains is what is most exposed.

Where to Invest $100,000 Right Now, According to Experts

Investors face a dilemma. When the S&P 500 finished its worst quarter since 2022 last month, diversifiers like bonds and bitcoin fell too.

Even with the turnaround in mid-April, analysts at Goldman Sachs and Vanguard have projected low-single-digit annualized returns from 2024-2034.

Bloomberg asked where experts would personally invest $100,000 for their March monthly edition.

One answer that surfaced for a second time? Art.

It's what billionaires like Bezos and the Rockefellers have privately used to diversify for decades.

Why?

1. Appreciation. The ArtPrice100 Index outpaced the S&P 500 overall from 2000 to 2025

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3. Resilience. A scarce, physical, and global asset class with decades of demonstrated demand.

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23.16 lakh units

That is the number of vehicles dispatched by companies to dealers in India across all categories in April, marking a 27.9% year-on-year jump, a report by the Society of Indian Automobile Manufacturers (SIAM) said on Thursday.

Rajesh Menon, Director General of SIAM, said the growth carried forward the demand momentum built after last year's GST rate cut, even as high commodity prices stemming from the war in West Asia remain a concern.

Catch Up Quick: Passenger vehicle dispatches led the momentum, surging 24.6% to 3.78 lakh units, with utility vehicles growing 21.5% to 2.44 lakh units and passenger cars rising sharply by 32.7% to 1.20 lakh units. The report does not include data from BMW, Mercedes, JLR, Tata Motors and Volvo Auto.

Overview: Two-wheeler sales proved equally buoyant, rising 28.4% to 18.72 lakh units, with motorcycles up 30.6% and scooters growing 26.2%. Three-wheeler dispatches also posted strong growth of 32.8% to 65,668 units.

Wholesale Inflation Surges

India’s wholesale inflation accelerated sharply in April, driven by a steep rise in fuel and energy prices amid escalating global crude oil costs linked to the West Asia crisis. WPI-based inflation climbed to a 42-month high, signalling mounting cost pressures across fuel, manufacturing and key industrial segments.

By The Numbers: India’s wholesale price inflation rose to 8.3% in April from 3.88% in March, according to data released by the Ministry of Commerce and Industry. Fuel and power inflation surged to 24.71% from 1.05%, led by higher prices of mineral oils, crude petroleum and natural gas. Crude petroleum inflation stood at 88.06%, while petrol inflation came in at 32.40% and high-speed diesel inflation at 25.19%.

Inflation in manufactured products, which carry the highest weight in the WPI basket, increased to 4.62% in April from 3.39% in March.

Forecast: Analysts expect elevated global crude oil prices and continued geopolitical tensions in West Asia to keep wholesale inflation under pressure in the coming months.

Rising input and fuel costs could gradually feed into retail inflation, potentially complicating the RBI’s inflation management outlook even as policymakers continue to monitor whether the current shock remains temporary.

Foreign Airlines Cash In

Air India's mounting flight cuts, driven by the Iran war and Pakistan's airspace ban, are handing foreign carriers a windfall in one of the world's fastest-growing aviation markets, Reuters reported.

Foreign airlines' share of India-origin international scheduled flights rose to 58.4% in March-May, up from 51.2% a year earlier, with Lufthansa's Swiss unit, KLM and Cathay Pacific among the notable gainers adding capacity on India routes.

The Lead: Air India, meanwhile, has never reported a profit since its 2022 privatisation. For fiscal year ​2025-26, it ​posted a $2.8 ‌billion loss.

Outgoing CEO Campbell Wilson earlier warned staff that the "massive rise" in jet fuel prices, combined with airspace closures and longer routings, had made many international flights unprofitable.

The Shift: The airline's US routes bore the brunt, with scheduled flights plunging 77.4% in March-May. Industry observers note that passengers increasingly prefer foreign carriers when Air India's fares are comparable but routings are longer, dealing a significant blow to its ambitions of becoming a credible global airline.

Rupee Record Slide

The Indian rupee slid to a record low of 95.9575 against the US dollar on Thursday, after earlier hitting a then-record low of 95.7950 on Tuesday, as soaring oil prices and foreign investor outflows rattled markets. 

Next Steps: Policymakers are reportedly weighing measures to stabilise the currency and protect India’s external finances as the Iran war disrupts global energy supplies and pushes crude prices higher. Prime Minister Narendra Modi has also urged measures to conserve foreign exchange reserves, while the government has raised tariffs on precious metal imports to curb demand.

Setting: Analysts say the Reserve Bank of India may introduce further regulatory measures to support the rupee, although they expect interest rate hikes to remain a last resort.

Russian Oil Lifeline

India has asked the US to extend a temporary sanctions waiver that allows Indian refiners to continue importing Russian crude oil, as the Iran war disrupts global energy supplies and shipping routes in the Persian Gulf, Bloomberg reported. The current US waiver reportedly expires on May 16.

Origin: The conflict has disrupted tanker traffic near the Strait of Hormuz, raised freight and insurance costs, and pushed global crude prices higher. India, which imports more than 85% of its oil needs, fears supply disruptions and higher inflation if access to discounted Russian crude becomes restricted.

The Turning Point: India sharply increased Russian oil imports after the Russia-Ukraine war began in 2022, taking advantage of steep discounts after Western buyers pulled back. Earlier this year, some Indian refiners reduced purchases of Russian crude after tighter US sanctions disrupted shipping and payments linked to Moscow’s oil trade. But as the Iran conflict pushed oil prices higher and threatened global supplies, Washington reportedly granted limited flexibility on some transactions to avoid a broader energy shock. Indian refiners are now rushing to secure additional Russian crude cargoes before the waiver deadline.

Markets Rise on China-US Talks

On Episode 873 of The Core Report, financial journalist Govindraj Ethiraj talks to Atul Chaturvedi, Chairman of the Asian Palm Oil Alliance as well as Indrani Bagchi, CEO at Ananta Aspen Centre.

• Markets rise on China-US talks as a sign of possible peace in West Asia.

• India’s Whole Sale Price Inflation jumps sharply.

• Can India reduce its dependence on cooking/vegetable oil ?

• What will a ban on sugar exports mean ?

• Viewing the China-US talks in Beijing right now through an Indian lens.