CaratAsian Star's small stones fell 22%. Its jewellery rose 17%
Asian Star's loose-diamond sales fell to INR 4.26 billion in the June quarter, down 22% on the year. Jewellery revenue rose 17% to INR 2.35 billion. Consolidated revenue fell 11% and net profit fell 38%.
§1Two halves, opposite ways.
Asian Star, one of India's larger listed diamond manufacturers, reported consolidated revenue of INR 6.47 billion, about $67.7 million, for the quarter to 30 June, down 11% on the year and 13% on the preceding quarter. Inside that total the two halves of the business went opposite ways. Loose-diamond sales fell 22% to INR 4.26 billion, about $44.6 million, and were down 11% sequentially as well. Jewellery revenue rose 17% to INR 2.35 billion, about $24.1 million. Net profit fell 38% to INR 120.6 million, about $1.3 million.
Work the reported percentages backwards and the mix shift is the story. A 22% fall puts last year's loose-diamond line at about INR 5.46 billion; a 17% rise puts last year's jewellery line at about INR 2.01 billion. Loose stones were therefore about 73% of the two segments taken together a year ago and are about 64% now. Nine points of a manufacturer's mix moved out of polishing and into finished goods in four quarters. One caveat belongs on that arithmetic and is stated rather than buried: the two segment lines sum to INR 6.61 billion against a consolidated INR 6.47 billion, a gap of INR 140 million, so the figures are reported before whatever eliminates between them and the shares above are shares of the segment sum, not of the group.
It did not merely sell less; it kept less of what it sold.
§2Still falling quarter on quarter.
The margin moved with the mix. INR 120.6 million of net profit on INR 6.47 billion of revenue is a net margin of 1.86%. On the same reported percentages, a year ago the company earned about INR 195 million on about INR 7.27 billion, a margin of 2.68%. It did not merely sell less; it kept less of what it sold. A 17% rise in the jewellery line was not enough to hold the group margin, which is the usual signal that the growing segment is the thinner one.
The sequential figures are what separate this from a base effect. Consolidated revenue fell 13% against the March quarter and loose-diamond sales fell 11% against it. A year-on-year decline can be an argument about an unusual 2025; a quarter-on-quarter decline in the same direction is the current tape. Small-stone demand was still contracting through the June quarter, not merely lower than an inflated comparison.
Read this against Gahcho Kue in today's lead and the two ends of the same pipe are visible in one morning. A Canadian producer sold 111% more carats at 44% less per carat; an Indian manufacturer bought and polished enough less of that material for its loose-diamond line to fall 22%. Both are the small-stone end of the market. Supply is arriving faster and cheaper, and the floor that turns it into polished goods is running smaller books.
Watch the jewellery line, not the apology for the diamond one. Asian Star's finished-goods revenue grew 17% in a quarter when its core business shrank by 22%, and that is the same move Titan and the Indian retail counter have been making all year. A manufacturer whose mix drifts nine points toward jewellery in four quarters is not waiting for polished demand to return; it is changing what it sells. The figure to check next quarter is whether the group margin follows the mix back up, because
at 1.86% there is not much room to absorb another 22%.
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