Suashish Diamonds to invest Rs 1500-mn

Mumbai: Suashish Diamonds will set up a new manufacturing unit in Mumbai with an investment of Rs 150 crore. The investments will be made through the company’s wholly owned subsidiary Suashish Jewellery Ltd.

The funding will be done through a mix of internal accruals and equity.

The new unit is estimated to add a capacity of five lakh jewellery pieces a year to the company’s existing annual capacity of over 10 lakh pieces of jewellery. The facility will be equipped with latest technology, which will ensure production of high quality jewellery for quality conscious market in Europe and countries.

The company would invest Rs 82 crore in the first phase for setting up a 16,000 sq ft manufacturing facility which will become operational in August.

“The first phase of the facility is expected to achieve a turnover of Rs 180 crore in its first year of operation. We will invest the remaining Rs 68 crore in two years,” said Mr Ashish Goenka, Managing Director of Suashish Diamonds.

Once the full resources are committed and both the phases become operational, we expect to achieve a turnover of Rs 400 crore annually, he added.

The expansion announcements come at a time when the Indian diamond industry is hit by reduced margins and sales owing to a slowdown in the US market and rising input costs like gold.

The fall in the number of Indian companies that have been granted sight holder status by the Diamond Trading Corporation (DTC) has added to the woes, he said. Sight holder status assures committed supply of rough diamonds at lower costs by DTC.