Last week, Tata Group's Trent company launched a new lab-grown diamond jewelry brand called "Pome" in its West Zone store, which led to a significant 7.67% surge in Trent's stock price. This high-profile launch has stirred considerable discussion within India's jewelry retail industry, bringing attention to the future potential of lab-grown diamonds in the market.
Tata Group already owns two major jewelry brands: Zoya, catering to high-end consumers, and Tanishq, which has a broader audience and collaborates with De Beers to promote natural diamonds. The introduction of Pome by Trent, another entity under Tata, has led to speculation about the company's future strategy for lab-grown diamonds. Media sources suggest that Pome could expand through exclusive brand outlets (EBOs), potentially reshaping the lab-grown diamond retail landscape in India.
Media Response and Expert Opinions
The Indian media has been actively discussing Pome's prospects. In a CNBC interview, Pooja Sheth, from the prominent lab-grown diamond brand Limelight, shared insights on several important topics:
Perception of Lab-Grown Diamonds in India: Pooja believes the future of lab-grown diamonds in India is optimistic, pointing out that the success of such diamonds in the U.S., which now hold over 50% market share, serves as a significant precedent. She noted that the lab-grown diamond retail market in India is growing at an annual rate of 15%-20%, making it the next important market after the U.S.
Market Potential: Currently, only a small percentage of Indian women (less than 5%) can afford natural diamonds, which makes lab-grown diamonds—with their higher affordability—an attractive alternative. This wider accessibility indicates vast market potential for lab-grown diamonds in India.
Pricing Trends: Pooja emphasized that recent price reductions mostly occur at the wholesale level, while retail prices have remained relatively stable. She explained that price drops are a sign of profit rationalization, and as profits decline, fewer players will remain in the market, leading to improved supply-demand dynamics and stable prices.
Future Outlook for India's Lab-Grown Diamond Industry
India, with its enormous consumer potential, presents a promising landscape for the lab-grown diamond sector, which is still exploring viable growth strategies. Industry experts like Pooja Sheth believe that lab-grown diamonds have a bright future, and their perspectives provide valuable encouragement for further development.
However, challenges remain, especially for the Chinese lab-grown diamond industry, which now faces increased competition from India's active market. To stay competitive, Chinese producers must establish independent standards, enhance the supply chain, invest in R&D, improve craftsmanship, and innovate their product offerings—all while focusing on effective retail marketing.