Indian Manufacturing Slump Hits Sarine Results

Sarine Technologies’ sales fell last year amid an oversupply in the midstream and weak demand that led to a two-month shutdown at Indian factories.

Revenue dropped 27% to $42.9 million for 2023, while the company recorded a loss of $2.8 million compared with a profit of $8.8 million a year ago, the Israel-based supplier of diamond-grading technology reported Monday.

Sales of capital equipment — customers’ one-off machine acquisitions — declined 50%, with most of the downturn taking place in the second half of the year. Recurring revenues from fees clients pay on an ongoing basis, such as for diamond scans, fell 3%. A 4% increase in recurring revenues in the second half partially offset these declines, with the company’s acquisition of a 70% stake in Gem Certification & Assurance Lab (GCAL) in May driving the improvement.

“During 2023, the diamond industry again faced significant macroeconomic headwinds, as well as disruption by the lab-grown diamond segment,” Sarine commented. “Firm rough prices and decreasing polished prices impaired margins for our midstream customers. Towards the end of 2023, Indian manufacturers declared a self-imposed two-month moratorium on the import of rough diamonds.”

Sales to India fell 27% to $22 million for the year as manufacturing demand faltered. Meanwhile, revenue from the Africa market slid 54% to $6.3 million. Sales to Europe slipped 22% to $2.7 million. Those drops outweighed growth in sales to the US of $5.1 million, compared to $842,000 the year before.

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Main image: Sarine Technologies’ lab in Israel. (Sarine Technologies)