The report says that Indian lab-grown diamond exports have grown six-fold from USD 225 million in FY2019 to USD 1,207 million in FY2025
Emphasising that lab-grown diamonds (LGDs) are expected to emerge as a separate category within the fashion and jewellery segment, Icra stated that their share in total cut and polished diamond (CPD) exports is projected to increase to 10 to 12 per cent (over 8.5 per cent in 10MFY26) over the next two to three years.
The report pointed out that Indian LGD exports have grown six-fold from USD 225 million in FY2019 to USD 1,207 million in FY2025. The discount in LGD prices (vis-à-vis natural diamonds) has increased from 15 per cent in FY16 to 90 per cent in FY25 owing to oversupply and rapid technological advancements. Further, the higher the caratage of LGDs, the larger are the discounts vis-à-vis natural diamonds.
Icra noted that LGDs have their fair share of challenges as they do not possess any major resale value and are not perceived as ‘real’ diamonds. Profits of LGD companies depend on their ability to generate high sales volumes.
“Besides attractive prices, the LGDs have a lower carbon footprint than natural diamonds and are less prone to supply disruptions. There is also greater control over the supply chain, and the diamonds can be produced in different varieties with a high degree of customisation,” Icra highlighted.
China is the leading producer of LGDs currently with an estimated 45 to 50 per cent share in terms of volume, followed by India with 25 to 30 per cent share. India’s share in LGD production has increased over the years led by declining cost of production (supported by greater adoption of the chemical vapour deposition (CVD) manufacturing process) and a growing gap between LGD and natural diamond prices, the report added.
