Core view
India import and export data tracking:
In January 2022, India’s import of cultivated diamond rough was US $153 million, a year-on-year increase of 77.86%, and the export of cultivated diamond bare diamonds was US $122 million, a year-on-year increase of 69.09%.
India’s import of natural diamond rough was US $1.214 billion, a year-on-year decrease of 3.38%, and the export of natural diamond bare diamonds was US $2.05 billion, a year-on-year increase of 13.60%. As the world’s largest diamond polishing and processing market, India’s high import and export data verified the high boom of downstream demand.
Diamond penetration:
In January 2022, the import penetration rate of cultivated diamonds in India was 11.21%, with a year-on-year increase of + 4.79 PCT; The permeability at the outlet end was 5.62%, with a year-on-year increase of + 1.77pct.
According to diamond observation data, compared with natural diamonds, cultivating diamonds can make more money in the middle reaches. 10% of diamond factories in Surat, India have processed and cultivated diamond products. By the end of 2019, the import and export data of cultivated diamonds had increased significantly, and the high growth rate was restored after a short decline affected by the epidemic.
Investment suggestion: at present, the C-end penetration rate of the global cultivation diamond market is only 4%, and the high cost performance advantage drives the rapid growth of downstream demand. Chinese manufacturers supply 40% of the world’s cultivated diamond blanks, which will significantly benefit from the rise of downstream demand. China’s diamond production is mainly cultivated by high temperature and high pressure method. Due to the capacity constraints of upstream equipment manufacturers, the expansion of the industry is limited. It is suggested to pay attention to Henan Liliang Diamond Co.Ltd(301071) , North Industries Group Red Arrow Co.Ltd(000519) , Henan Huanghe Whirlwind Co.Ltd(600172) with high market share and good cooperation with upstream equipment manufacturers, and Sinomach Precision Industry Co.Ltd(002046) with two technical paths of HPHT / CVD at the same time.
Risk tip: the downstream demand is less than expected, the production capacity is less than expected, and the industry competition is intensified.
