Sunraj Diamond Exports Ltd Management Discussions

Industry Structure and Development:

The industry during the year 2025 - 2026 saw a lean year in Business activity ranging from Raw Material Import, Manufacturing activity and Sales of finished goods. The prices of Raw Materials and Finished products continued to remain low. The weakness in global markets has shown little signs of recovery. The rise of sales in Lab Grown Diamonds continued to rise. The Middle Eastern War situation has given rise to gold prices thereby marginally shrinking Jewellery purchases.

Opportunities and Threats

Prices of Raw Materials being low have resulted in profits for a manufacturer in some categories. This results in competitive costing for the finished product. There remains opportunity for traders to increase their margins and purchase finished products at good prices.

The threat from Lab Grown Diamonds continues, resulting in market share of Natural Diamonds shrinking consistently. Global markets like the US and Europe are flush with Lab Grown Diamond purchases. Inflation continues to be a major concern for developed markets, which fuels the purchase of Lab Grown over Natural Diamonds due to the vast price differential.

Segment-wise Performance

The Company currently has only one business segment viz. trading in cut and polished diamonds and hence product-wise performance is not provided.

Outlook

The Indian Diamond Industry is currently seeing a short-term revival in the Natural Diamond Industry with prices being stable and demand returning for certain categories. The US market continues to be the leader in consumption of Lab Grown Diamonds. Other developed markets are gradually increasing purchases of Lab Grown Diamonds. We expect 2026 -2027 to be a year of growth, and we see business picking up.

Risk and Concerns

The Company identifies Inflation as major concern, high gold prices bringing weaker Jewellery sales as we approach the festive season.

Internal Control Systems and their Adequacy

The Company has a satisfactory internal control system, the adequacy of which has been mentioned in the Auditors Report.

Human Resources

There has been no material development on the Human Resource / Industrial relations front during the year.