IGI Stock Falls as Investors React to Financial Results
Shares of International Gemmological Institute a leading jewellery certification firm, plummeted 10% to ₹366.25 apiece on the National Stock Exchange (NSE) on Monday, March 3, 2025. The sharp decline came after the company reported its financial results for the fourth quarter (Q4) and the full year of 2024 on Friday, February 28, 2025.
Despite reporting strong revenue and profit growth, investor sentiment turned negative, triggering a lower circuit limit for the stock. The company follows a January-December financial calendar year, making Q4 its final quarter for 2024.
At its current price, Companies market capitalization stands at ₹15,827.85 crore.
Q4 and Full-Year CY24 Financial Performance
Despite the 10% drop in stock price, Company reported strong financial results for both the quarter and full calendar year 2024.
Q4 CY24 Financial Highlights
- Revenue from operations increased 6% YoY to ₹265 crore, compared to ₹249.9 crore in Q4 CY23.
- Profit after tax (PAT) surged 45% YoY to ₹113.78 crore, up from ₹78.4 crore in the same quarter last year.
Full-Year CY24 Financial Highlights
- Annual revenue grew 17% YoY to ₹1,053.1 crore, compared to ₹898 crore in CY23.
- Post-tax profit increased 29% YoY to ₹427.2 crore, compared to ₹330.8 crore in CY23.
Despite solid financial growth, the stock faced strong selling pressure, with investors possibly reacting to concerns over valuation, market conditions, or future outlook.
Global Market Share and Expansion Strategy
Commenting on the earnings results, Tehmasp Printer, Managing Director and CEO of IGI, highlighted the company’s strong market presence and future growth plans:
“With a 33% global market share in diamond certification and 65% market share in lab-grown diamonds, we continue to expand our presence and enhance our service offerings. The successful acquisition of IGI Belgium and IGI Netherlands further strengthens our global footprint, allowing us to serve an even wider customer base.”
Competitive Position in the Industry
- IGI is a leader in diamond certification, with a significant share in both natural and lab-grown diamonds.
- The company continues to expand internationally, with new acquisitions strengthening its European footprint.
- It provides certification and grading services for diamonds, jewellery, and gemstones, catering to jewellers, manufacturers, and retailers worldwide.
Why Did Shares Hit the 10% Lower Circuit?
1. Profit Booking After Recent Gains
- Company shares debuted at ₹510 per share on December 20, 2024, with a 22.3% premium over the IPO price of ₹417 per share.
- Since then, the stock has declined 12.17% from its issue price, indicating profit booking by investors.
2. Market Reaction to Earnings
- Despite strong revenue and profit growth, the stock’s decline suggests that investors may have been expecting even stronger numbers.
- High valuation concerns could also be a factor, as stocks in the diamond certification industry often trade at premium multiples.
3. Broader Market Trends
- Market-wide volatility in the broader mid-cap and small-cap segments has affected multiple stocks, including IGI.
- Investors are showing caution towards newly listed companies, especially those with high valuations.
Stock Performance and IPO Details
Stock Performance Since Listing
- IPO Issue Price: ₹417 per share
- Listing Price (December 20, 2024): ₹510 per share (+22.3% premium)
- Current Price (March 3, 2025): ₹366.25 per share (-12.17% from IPO price)
Companies IPO Details
- Total IPO Size: ₹4,225 crore
- Subscription Rate: 33.78 times
- Breakdown:
- Fresh Issue: ₹1,475 crore
- Offer for Sale (OFS): ₹2,750 crore
IGI’s IPO was heavily subscribed, reflecting strong demand from investors. However, the recent stock correction suggests that early investors are booking profits or reassessing valuations.
Company Overview: International Gemmological Institute (IGI)
IGI is India’s largest independent accreditation and certification services provider for diamonds and gemstones. The company is backed by Blackstone, one of the world’s largest investment firms.
Key Services Offered by IGI
✅ Natural Diamond Certification – Authenticating the quality and purity of natural diamonds.
✅ Lab-Grown Diamond Certification – Grading and certifying synthetic diamonds.
✅ Jewellery Identification and Appraisal – Evaluating finished jewellery for quality assurance.
✅ Coloured Stone Grading – Analyzing the origin and quality of gemstones.
With its global presence and strong market share, IGI is a key player in the diamond and jewellery certification industry.
Industry Outlook: What Lies Ahead for IGI?
1. Rising Demand for Diamond Certification
- Consumers are increasingly prioritizing certified jewellery, driving demand for third-party authentication services.
- IGI’s stronghold in the diamond certification market positions it well for long-term growth.
2. Growth in Lab-Grown Diamonds
- Lab-grown diamonds are gaining popularity due to their cost-effectiveness and sustainability.
- IGI, with its 65% market share in lab-grown diamonds, stands to benefit from this growing trend.
3. International Expansion and Acquisitions
- IGI’s acquisition of IGI Belgium and IGI Netherlands expands its global footprint, allowing it to serve more clients worldwide.
- As the company enters new markets, it could see higher revenue growth in the coming years.
Should Investors Buy, Hold, or Sell IGI Stock?
✅ Reasons to Buy IGI Stock
- Strong market position in both natural and lab-grown diamond certification.
- Consistent revenue and profit growth, despite market volatility.
- International expansion strategy to drive long-term business growth.
⚠ Risks to Consider
- Stock trading below IPO price could indicate investor concerns over valuation.
- Market volatility in mid-cap and small-cap stocks may affect near-term performance.
- Profit booking by early investors could continue in the short term.
📌 Conclusion: Investors should wait for further stability in stock price and assess upcoming earnings trends before making long-term decisions. IGI remains a strong business with growth potential, but market sentiment will dictate near-term stock movements.
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