JB Insights
Anglo American writes down De Beers’ value by US $1.6 bn
As part of its annual financial results, Anglo American wrote down De Beers’ book value by $1.6 billion, principally relating to goodwill (brand value).
The diamond giant is now valued at $7.6 billion. Its write-down was driven “by lower prices than previous forecasts reflecting a reduction in forecast consumer demand,” Anglo American said in its year-end financial report. “This reflects macroeconomic uncertainty mainly in the U.S. and China.”
Other factors cited by Anglo: “the timing of differentiation between lab-grown and natural diamonds, the impact of recycling, the latest…estimates and life of asset plans for the mines and, less significantly, the financial impact of revised contractual terms [between De Beers and] the government of the Republic of Botswana (which are expected to be finalized during 2024).”
In a separate financial statement, De Beers said the industry began to stabilize over the fourth quarter. “Retail demand improved over the end-of-year holiday season, especially in the United States, helping to ease midstream inventory pressure,” it said. “However, with ongoing macroeconomic uncertainty, it is anticipated that recovery in rough diamond demand will be gradual.”
De Beers’ statement added: “The ongoing focus on diamond provenance—especially given the expected introduction of Russian diamond import restrictions by G7 nations—has the potential to reinforce demand for De Beers’ rough diamonds, supported by the blockchain Tracr platform. The global supply of rough diamonds is anticipated to continue to decline owing to the maturity of major mines and limited new discoveries.”
Johnson says the write-down “has no tangible impact and is simply an accounting assessment of the current value of the business compared with the value it was assigned at the time Anglo American purchased its majority shareholding [in 2012]. The new carrying value reflects the very challenging macroeconomic environment but has no bearing on our confidence in the positive long-term outlook for natural diamonds.”
JB Insights
India’s Major Retail Jewelers See Double Digit Revenue Growth
Growth Points To Robust Momentum Ahead Of The Crucial Third-Quarter Holiday Season.
India’s major listed jewelers are shrugging off a shift in the traditional holiday shopping calendar, reporting revenue growth between 22% and 28% for the quarter ended September on the back of resilient consumer appetite and higher average customer spending.
Industry giants including Titan Co., Kalyan Jewellers India Ltd., P N Gadgil Jewellers Ltd., and PC Jeweller Ltd. posted broad-based sales gains in business updates to stock exchanges, pointing to robust momentum ahead of the crucial third-quarter holiday season.
The strong second-quarter numbers come despite a calendar quirk: Navratri, the nine-night festival that typically kicks off peak seasonal gold buying, fell in October this year rather than September. That shift is expected to push a significant volume of traditional holiday sales into the quarter ending in December.
Kalyan Jewellers posted a consolidated revenue increase of more than 26% year-over-year, buoyed by a 27% surge in its domestic operations and a 20% rise in same-store sales. Its international operations expanded 18%, while its digital lifestyle arm, Candere, saw sales jump 64%. The company noted that domestic operations maintained strong momentum even against a tough comparison from the year-ago period, when the entire Navratri festival landed in the second quarter.
The revenue growth reflects both steady store expansion and higher ticket sizes. At Tata Group-owned Titan Co., which operates the Tanishq and Zoya brands, total jewelry sales rose approximately 21%.
While buyer volume growth tracked in the mid-single digits, average spend per transaction rose by double digits. Sales of studded, higher-margin jewelry led the way with growth in the low 30s percentage range, outstripping a 20% gain in plain gold items. Titan’s digital-first brand, CaratLane, posted a 32% rise in sales.
Strategically, several retailers are intentionally pivoting away from low-margin bullion toward high-margin studded items and branded pieces. P N Gadgil Jewellers, which logged 22.4% overall revenue growth and a 31.1% gain in its core retail segment, saw e-commerce sales fall sharply by 83.6% after deliberately trimming back online sales of low-margin gold coins.
Consequently, gold coins and bars made up 15.8% of P N Gadgil’s retail revenue during the quarter, down from 23.3% a year earlier—a mix shift executives say will sustain higher profitability.
Meanwhile, Delhi-based PC Jeweller posted a consolidated revenue gain of roughly 28%, citing sustained underlying demand across key urban markets.
With fundamental demand holding firm despite elevated gold prices, market analysts expect the delayed start to the Hindu festive season to set up Indian jewelers for a particularly lucrative December quarter.
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