In a bid to enhance liquidity support, London-based Gemfields plc plans to increase the buyback of cut and polished stones from downstream companies, largely in Jaipur.

The company is a leading supplier of rough coloured gemstones such as emerald, ruby and sapphire, with a market share of 20 per cent.

Gemfields COO Dev Shetty said at a press conference here that the decision was taken to support the cut and polish trade in the coloured stones industry, as the players in that sector typically lack access to bank funding and find it difficult to participate in the auction for rough stones conducted by Gemfields.

The company intends to buy back value added coloured stones worth $75 million (₹470 crore) over the next five years from the trade. It has tied up with 18 renowned designers and large manufacturers in the US and UK to sell the gemstones sourced from Jaipur.

While Gemefields sells it rough colour stones through auctions, it plans to buy back cut and polished stones at negotiated prices.

“We do not mind paying a little extra to the cut-and-polish companies as they are the ones who would come back to our auction to bid for roughs,” said Shetty. Lack of clarity on the resale value and the astrological sentiments attached to the coloured gemstones have hampered their market penetration.

Jewellery market

The jewellery market for coloured gemstones is estimated at ₹3,400-3,800 crore with smaller pieces such as rings and earrings accounting for 70 per cent of the market share and 50 per cent of total value. Purchases made for astrological reasons account for about ₹570 crore, according to a Gemfields study.

Gemfields is also mulling colour stone mining in Kashmir, Karnataka, Odisha and Jharkhand.

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