Lab-grown diamond startups in India are experiencing rapid growth as they seek to meet the increasing demand for affordable, sustainable alternatives to natural diamonds.
With more consumers showing interest in ethical and cost-effective options, these startups are scaling up their operations to establish themselves as dominant players in the market.
Although traditional jewellers have a strong presence in India, no single company has emerged as the leader in the domestic lab-grown diamond space.
This absence of a clear market leader has created significant opportunities for new startups.
These companies are expanding their retail footprint in an effort to capture a share of the growing demand for lab-grown diamonds.
“The lab-grown diamond space in India is still at a very nascent stage. A lot of category awareness and category creation is still underway,” said Vidita Kochar, co-founder of Jewelbox, a prominent lab-grown diamond startup.
The company gained attention after securing investments from Shark Tank India judges, including Aman Gupta (boAt), Vineeta Singh (Sugar Cosmetics), Peyush Bansal (Lenskart), and Ritesh Agarwal (Oyo).
Kochar believes that despite the absence of a clear national leader, the market holds great potential.
“As a two-and-a-half-year-old brand and one of the early entrants, we have robust plans to expand our retail operations. But India is not a winner-take-all market, and there’s definitely a place for multiple brands to lead the category,” she said.
Retail Expansion And Changing Consumer Preferences
Jewelbox, based in Kolkata, currently operates eight stores across six cities, including Delhi, Bengaluru, and Chennai.
The company plans to accelerate its expansion, aiming to open 25 more stores by the end of the financial year, mainly in Tier 1 cities where awareness is highest.
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Despite the focus on physical retail growth, around 40% of Jewelbox’s orders still come from its online platform.
Lab-grown diamonds are particularly appealing to aspirational consumers who have long desired diamond jewellery but found natural diamonds prohibitively expensive.
“This segment is creating an entirely new market in India, where people who historically have not owned diamonds are now adopting diamond jewellery,” explained Kochar.
Growing Startup Ecosystem And Traditional Players’ Recognition
Jewelbox is not the only startup making strides in the lab-grown diamond space.
Other companies, such as Mumbai-based Limelight, Fiona Diamonds, Wondr Diamonds, and Titan Capital-backed Truecarat Diamonds, are also emerging as key players.
With 37 lab-grown diamond startups now operating in India – more than in any other country – there is a clear shift toward this growing sector.
In addition to these startups, traditional players are also recognizing the market potential.
Recently, gold trading platform Augmont invested Rs 100 crore to launch its own lab-grown diamond brand, Akoirah, further signaling the growing interest in this space.
Price Dynamics And Supply Chain Adjustments
Unlike natural diamonds, which follow the Rapaport price list, retailers price lab-grown diamonds based on production costs and value addition.
Initially, lab-grown diamonds were priced at a discount to natural diamonds, leading to substantial profit margins for suppliers. However, these profit margins have diminished over time.
Kochar noted that over the past year, lab-grown diamond prices have fallen by 25-30% due to oversupply, as production units are relatively inexpensive to set up.
She also mentioned that technological advancements could further reduce manufacturing costs, potentially lowering prices even more.
While this reduction in margins presents challenges for businesses, it also makes lab-grown diamonds more accessible to a broader audience.
Scaling Up To Sustain Growth
Since lab-grown diamonds are not limited by the natural supply, startups in this sector must significantly scale up their operations to remain sustainable.
“To maintain a healthy average order value, startups in this space need to grow their volumes at least 7-8 times,” said an investor in the lab-grown diamond industry.
Ultimately, success in the lab-grown diamond sector will depend heavily on effective branding and the ability to meet the growing demand for these sustainable and affordable alternatives.
The industry is still in its early stages, but the increasing consumer interest suggests a bright future for these innovative companies.
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