Authoritative institutions and large jewelers join the bureau to promote the renewal of consumer ideas. Cultivated diamond was born in the 1950s, and then research laboratories around the world continued to update technology in this field, The production methods mainly include high temperature and high pressure method (HTHP) and chemical vapor precipitation method (CVD). In the 21st century, gem grade cultivated diamonds have made technological breakthroughs, improved production technology and shortened cultivation time, providing a basis for the supply of fashion consumer market. Cultivated diamonds with basically the same nature as natural diamonds were included in the diamond category by the authority FTC in 2018, triggering the establishment of industry standards and technical specifications, the entry of well-known jewelers and the renewal of consumer education ideas 。 Cultivated diamonds are gradually favored by consumers because of their high cost performance, environmental protection and strong personalization.
The upstream, middle and downstream development space of the diamond industry is broad, and the scale of the upstream market is expected to exceed 20 billion yuan. The cultivation of diamond upstream rough diamond production has high technical barriers, low industrial competition and high gross profit margin. China's six sided top press plays an important role in production and highlights China's technical advantages; The cutting end in the middle reaches is concentrated in diamond mining, trade center and areas with low labor cost, sharing the industrial chain with natural diamonds; At present, the downstream consumer end mainly has the U.S. market, and the Chinese market has broad prospects. With the layout of well-known jewelers to cultivate the diamond industry, the concept of consumers has gradually changed. Compared with natural diamonds, the lower cost, the increase of "pleasing consumption" of the younger generation, and the environmental and social friendliness of the diamond production process have become the driving force for the development of the downstream market of cultivated diamonds.
The profits of the industrial chain are concentrated in the production and retail end, and the gross profit margin of cultivated diamond production and retail end can basically reach more than 50%. Due to the decline of natural diamond production and the expansion of diamond market demand, we believe that the market scale of cultivated diamond is expected to continue to expand. According to relevant assumptions, we predict that the scale of the global cultivated diamond rough diamond market will exceed 20 billion yuan in 2023 and the scale of the terminal market will exceed 100 billion yuan in 2025. Well known diamond brand cultivation pioneers drive the development of the industry. In 2020, the output of cultivated diamonds in China will be about 300 million carats, accounting for nearly 50% of the global production capacity. It is the largest cultivated diamond producing country in the world. Among them, HTHP method leads the cultivation of diamond production in China; CVD technology is continuously updated iteratively. China's well-known diamond producers include North Industries Group Red Arrow Co.Ltd(000519) , Henan Huanghe Whirlwind Co.Ltd(600172) and Henan Liliang Diamond Co.Ltd(301071) . As a wholly-owned subsidiary of North Industries Group Red Arrow Co.Ltd(000519) , Zhongnan diamond has completed the development of cultivated diamonds in recent years and produced them by HTHP method. It has become one of the main producers of cultivated diamonds in China. Henan Huanghe Whirlwind Co.Ltd(600172) was established in 1994. It is a supplier of superhard materials with a long history, leading scale and complete variety. It helps to cultivate the development of diamond business with its R & D ability combined with the advantages of the whole industrial chain. Henan Liliang Diamond Co.Ltd(301071) specializes in the R & D, production and sales of synthetic diamond products, cultivating diamonds as a new growth point, and will continue to make breakthroughs in technology and market in the future.
Investment suggestion: the prosperity of the industry is expected to continue, and the production and marketing are booming in the future. Based on the decline of natural diamond production and the gradual release of diamond cultivation capacity, we expect the penetration rate of diamond cultivation at the production end to further increase; In terms of end consumption, with the change of consumers' concept, including the change of concept driven by the entry of well-known brands, the increase of the proportion of self pleasing demand and the preference for environment-friendly production, the cultivation of diamond retail end is expected to continue in large quantities. In conclusion, the cultivation of diamond industry is expected in the future, and the prosperity of production and marketing will help the industry rise. It is suggested to pay attention to the changes in the supply of diamond press for production and Cultivation under high temperature and high pressure, as well as the iteration of retail demand in China and the United States. Recommended target: [ Henan Liliang Diamond Co.Ltd(301071) ], it is recommended to pay attention to: [ North Industries Group Red Arrow Co.Ltd(000519) ], [ Henan Huanghe Whirlwind Co.Ltd(600172) ], [yudiamond], [ Sinomach Precision Industry Co.Ltd(002046) ].
Risk tips: macroeconomic and market demand fluctuation risk, raw material price fluctuation risk, technical risk, increased market competition risk, industry development less than expected risk
