India’s Asian Star Sees Sales Plunge

RAPAPORT… Sales and profit plummeted at Indian diamond manufacturer Asian Star in the first fiscal quarter as the coronavirus froze the company’s activities.

Revenue slumped 80% year on year to INR 1.64 billion ($22.2 million) for the three months ending June 30, the Mumbai-based company said earlier this month. Net profit plunged 98% to INR 4.3 million ($58,356).

The figures, which include the company’s subsidiaries, reflect a tough period for the Indian diamond industry as the pandemic forced factories to shut and reduced global polished demand. The country has steadily reopened, but infections remain high.

“With the Covid-19-induced nationwide lockdown imposed since the last week of March, the company’s operations were severely disrupted during the major part of the quarter, resulting in significant loss of revenue and [having] an impact on profitability,” Asian Star explained. “With the introduction of relaxations by the government, operations resumed from mid-May at all the locations in a phased manner.”

Diamond revenue fell 82% to INR 1.36 billion ($18.4 million) for the period, while sales of finished jewelry dropped 81% to $275.5 million ($3.7 million).

The diamond division generated a loss of INR 26 million ($351,895) before interest and tax, compared with a profit of INR 290 million ($3.9 million) a year ago. Losses from jewelry operations stood at INR 22.7 million ($307,216), versus a profit of INR 56 million ($758,658) for the same period of 2019.

Image: Polished diamonds. (Shutterstock)