Investor Centre MD's Message

MD's Message

It is always a privilege and a pleasure to present a review of the Company’s performance for the year as well as share a strategic overview of the steps we are taking to navigate what is undoubtedly a challenging phase for the industry.

The global economy has been facing rough headwinds since the last few years. Key consumption markets in the US as well as Europe are yet to completely recover from the aftershocks of the global financial crisis. The ripples created by the continued uncertainty in the US over tariff wars with China have been affecting all major economies. The undecided deadlock over Brexit and its impact on UK-Europe trade relations has further added to the already nervous investor and consumer sentiments. Despite this, demand for diamond jewellery continued to grow during the year 2018, although at a marginal rate. The US and China continued to be the key markets driving this moderate growth. 

The Indian Gems and Jewellery industry is going through a period of aberration. Impacted by the recent crisis triggered by unethical and unscrupulous activities, the entire industry has borne the brunt. This is both unfortunate and unfair. In my opinion, the Indian diamond trade and industry is founded on solid foundations of trust and buttressed by centuries and generations of faith. This crisis is only a temporary blip that the industry will soon leave behind and move on. The industry in India has faced many challenges from time to time over the years. It has not only overcome these challenges, but more importantly, emerged stronger. During the year, gross exports of gems and jewellery from India was USD 40 billion. Exports of cut and polished diamonds for the year was moderately higher at USD 23.8 billion against USD 23.7 billion in the previous year. However, gold jewellery exports witnessed a spectacular growth of 24.6%, rising from USD 9.67 billion in 2017-18 to USD 12.03 billion in 2018-19. 

At Asian Star, we have always been a company that is built on strong values and ethics. While business cycles have their own highs and lows, we believe it is our strict adherence to purpose and principles that has seen us emerge as one of the leading players in the Indian Gems and Jewellery industry. Like diamonds, we emerge stronger from pressure. We constantly chip away our weaknesses through continuous learning and development. We have our unique new strengths and competencies that make us shine in our own way. 

Let me now update you on the performance of the Company for the year:

Our Consolidated Turnover for the year was Rs. 3,642.19 crore against Rs.  3,905. 03 crore in the previous year. However, our PAT for the year, in spite of a lesser turnover, increased to Rs. 114.93 crore against Rs. 109.13 crore in the previous year. Considering the extremely challenging operating environment during the year, I believe this is a steady financial performance, mirroring our consistent marketing efforts, our financial prudence as well as our operational efficiency. 

Looking ahead, I am confident that the industry is on the right track. The demand in the US and China is expected to continue to grow. Demand in India is also expected to pick up driven by the increasingly affluent middle class. Moreover, initiatives taken by the Government like 100% FDI, setting up of Jewellery Park in Mumbai and sustained promotion of Brand India in international markets are all definitive steps in the right direction, aimed at long-term growth of the Gems and Jewellery industry in the country. 

Overall, I am quite optimistic. The worse is behind for the industry and all indications point to a positive future ahead. As favourable tailwinds accelerate the momentum, Asian Star is perfectly positioned to leverage its strong position in the industry and deliver excellent value to all its stakeholders.

My sincere thanks and heartfelt gratitude to our customers, our suppliers, our investors, our bankers, our employees and all our shareholders for their sustained cooperation and support.