India to get lion’s share of the global colour stone market

Dev Shetty, President and CEO, Fura Gems in a conversation with Samit Bhatta, Publisher, The Retail Jeweller shares his company’s vision for 2024 and his future plans for the Indian jewellery market. 

Samit Bhatta (SB): What is Fura Gem’s view of the current situation and what is important right now for companies in the colour gemstones sector?

Dev Shetty (DS): Undoubtedly, it is a very difficult time. It is an unprecedented situation and I don’t think anyone thought of this situation 3 months ago. The current situation needs a lot of patience. As you know and if you see the history of difficult days, it is always followed by a good time and the recovery is much faster. The most important aspect right now is to have a lot of patience. In our business, we have put together 2 important things, sustainability and stability. I don’t think business should talk about profitability. I don’t think that there is any need for panic. It’s very important that they sail through this phase of 2020. They must look for more stable business, stability and then look for 2021 to sustain the business and grow from thereon. What we are looking personally and we believe is the businesses should have a lot of patience and there is no need to have any distress. Businesses should take care of their employees. It’s not only a difficult time for the business but also for the employees. Sit on cash because cash is the key and during this part of the time, sit on the inventory if they can and just be ready for the good times. I truly believe that the good time is around the corner and as we sail through the businesses will start by putting losses but 2020 should be more about stability.

SB: What does the future hold for colour gemstones and what is Fura’s vision for 2024?

DS: If I particularly talk about the colour gemstones from the history of mankind it is always been into existence. But unfortunately, the supply has been the biggest challenge. When the demand is so high but the supply is less, we have always seen that the demand outpaces the supply. So, in this scenario what we truly believe is that as the world starts opening up, the challenge would be again to meet the demand. So, what we are going to see is an exponential growth in the demand and we would be in the place where we will struggle to supply the demand that will come through. The amount of margin colour stones gives to the jewellers is at least 30%, whereas the peer group margin is in single digits. So, the opportunity is always there for the colour gemstone players who keep on making the margins and especially when there are losses in the business due to shut down, the recovery would be much better because it will give them a lot of opportunities to put off the losses by having more colour stones in the portfolio.

SB: In India, the diamond industry had a good last two decades. The industry grew from just around $300 million from 1999 to today’s $3 billion. Where do you see Fura Gems taking the colour gemstone industry of India in the next 5-10 years and what are your plans for the Indian jewellery market? 

DS: India is undoubtedly a very important market for us. The love for colour gemstones in India was always there. As far as our portfolio is concerned, we have got all the 3 colours, Emeralds, Rubies and Sapphires. In India 8 out of 10 Emeralds are cut and polished so, it is a very important market for us when it comes to trade. So, we do focus a lot as far as India is concerned. When it comes to Ruby, Indian clients and Indian customers they have an inherent love for colour. So, Rubies are a very important segment and we believe its number 2 across the world and India sells and consumes most of the Rubies when it comes to the ranking in volume terms. We also have Yellow Sapphires which is in high demand as far as the Indian market is concerned. For Fura, we have got Green Emerald, Red Ruby and we also have a multi-colour Sapphire coming out of Australian mines. So, with one company we will be catering to all the important products as far as the Indian market is concerned. As you know that the colour gemstones come out from a low base and for the last 10 years colour stones have seen a consistent supply coming out in a consistent manner, we are planning to have strong marketing programs in India. Fura’s vision is to have 10% of the global market share in the next few years roughly around 2024. It’s a $2 billion rough market, so we are targeting around $200 million in market share and India is going to be top 3 selling countries for us. As far as our understanding of the Indian market, as soon as you start consistent supply, we can take the global share of the $2 billion from markets in India and also in other places and within 5 years, the $2 billion rough can reach to $5 billion, and India will have the lion’s share.