International Gemmological Institute (India) Limited (NSE: IGIL) Q2 2025 Earnings Call dated Jul. 29, 2025
Corporate Participants:
Sumeet Khaitan — Investor Relations
Tehmasp Printer — Managing Director & Chief Executive Officer
Eashwar Iyer — Chief Financial Officer
Analysts:
Sheela Rathi — Analyst
Harit Kumar — Analyst
Aaron Armstrong — Analyst
Harish Advani — Analyst
Angad Qadri — Analyst
Harsh Shah — Analyst
Naitik Mutha. — Analyst
Shravan Vora — Analyst
Sumit Sarda — Analyst
Raman Venkata Kerti — Analyst
Smith Gala — Analyst
Chintan Seth — Analyst
Presentation:
Operator
Ladies and gentlemen, good day and welcome to the Q1CY25 Earnings Conference Call of
International Gemmological Institute (India) Limited, hosted by MUFG Intime. As a reminder, all participant lines will be in the listen only mode and there will be an opportunity for you to ask questions after the presentation concludes. Should you need assistance during this conference call, please signal an operator by pressing Star then zero on your touchstone phone. Please note that this conference is being recorded. I now hand the conference over to Mr. Sumit Ketan from MUFG in time. Thank you. And over to you sir.
Sumeet Khaitan — Investor Relations
Thank you. Palak. Good evening everyone. I welcome you all to the earnings conference call to discuss Q2 and H1 CY25 results of International Gemological Institute India Limited to discuss the result we have from the management, Mr. Tahmas, Printer, M.D. cEO and Mr. Ishwara, CFO. They will take you through the results and the business performance after which we will proceed for question and answer session. Before we proceed with the call, I would like to mention that some of the statements made in the today’s call may be forward looking in nature and may involve risk and uncertainties. For more details, kindly refer to the investor presentation and the other filings that can be found on the company’s website. With this, I now hand over the call to the management for their opening remarks. Thank you. And over to you, sir.
Tehmasp Printer — Managing Director & Chief Executive Officer
Thank you, Sameet. Good evening ladies and gentlemen. I would like to welcome you all to the Q2 CY25 earnings call. I trust that everyone has had a chance to review our financials and investor presentations which have been made available on both the stock exchanges as well as our company website. It’s a pleasure to connect with you all and share insights into our business strategies and outlook. To recap, we are the largest independent accreditation certifying services provider in India with over 50% market share. Globally we are the second largest player with 33% and in lab grown diamonds we have over 65% of the global market share in certification. We serve 9 out of 10 retail jewelry chains in India and we expect to continue to leverage our position to expand our global presence and establish IGI as a laboratory of choice to the large retailers and brands. We are present across 10 countries and we have 31 laboratories, 12 in factory laboratory setups, 18 schools of gemology we are present across the entire jewelry value chain. Our multiple service delivery formats are in the form of IGI laboratories in factory laboratories, mobile labs which essentially strengthen our customer relationships and driving a distinct advantage for the company. Our school of Gemology. Provides awareness, knowledge and information to help us drive the brand awareness, market expansion opportunities and new customer acquisitions. I’m happy to report that the company has seen a strong growth momentum across all its business segments in Q2 of 2025 as compared to Q2 of 2024. The business on a consolidated basis has done exceptionally well with 16% growth in revenues from operations and 37% growth in EBITDA. On a year on year basis, the business has delivered a volume growth in Q2.25 with 3.03 million reports a 21% growth over the previous year, the business has seen strong growth across its segments. Slab Grown has grown by 24%, natural diamonds have grown by 14% over the previous year. For the first half ended in June 2025, the business has delivered revenue from operations growth of 13% and EBITDA growth of 23%. The volume over this period grew by 24% with strong performance across all our business segments, natural Diamonds, Lab grown diamonds, jewelry and Colored stones. Going forward, we expect this demand to continue both across the natural diamonds as well as lab grown diamonds. Further, with demand for jewelry certification on the rise, we expect the jewelry segment to drive a significant proportion of growth in the quarters to come. Finally, with increasing adoption of lab grown diamond jewelry in India, we expect the revenue from this segment also to increase significantly in the future. With the industry evolving at a rapid pace and certification becoming a key enabler of consumer trust, IGI is focusing on strengthening its leadership position by expanding its presence, embracing innovations and and enhancing the overall customer experience. As demand for both natural as well as lab grown diamonds continue to grow, IGI is strategically positioned to capture the immense opportunities ahead. The company is also embarking on a digital transformation initiative as we seek to enhance the quality of our service delivery as well as reduce the turnaround time for our services. Overall, we are confident of maintaining the growth momentum, delivering revenue and EBITDA growth this year. In line with our historical performance, we remain committed to enabling growth for our partners, delivering long term value to all our stakeholders. With that, I Now invite our CFO Mr. Ishwar Iyer. To take you through the financials and operations performance for the quarter over to Ishwar.
Eashwar Iyer — Chief Financial Officer
Thank you Temaaz and good evening everyone. Thanks for taking the time for joining today’s conference call. As Temaaz just articulated, we are extremely delighted to have each of you with us. As many of you know, our company follows a January to December reporting cycle and we are therefore excited to present the results for the second quarter for calendar year 25. I will start with an update of the quarter two performance before providing an update for the half year performance as well. On a consolidated group performance standpoint, I’m happy to report that the group Consolidated Business has maintained a very, very strong growth momentum in quarter two. 25. In terms of revenue, certification income for the current quarter stood at 292 crores which is showing a growth of 18% over the same time last year. Correspondingly, the volume growth was at 21%. This was primarily driven by strong revenue growth across all our core segments, namely 14% growth in natural diamonds 24% growth in lab grown diamonds. Total revenues for the quarter therefore stood at 314 crores, registering a growth of 20% in terms of reported volumes. During the quarter we delivered 3.03 million reports compared to 2.5 million reports in Q2.24, registering a growth of 21% driven by strong revenue performance. Continued Cost Optimization in some of our global offices we have delivered a PAT of 127 crores, marking a growth of 63% compared to the previous quarter. PAT margins stood at 42% for this quarter. EBITDA stood at 174 crores, reflecting a growth of 37% compared to the previous quarter. EBITDA margins stood at 58%. Coming to the half yearly update On a consolidated group performance standpoint, for the half year ended June 2025 we delivered 6.16 million reports compared to 4.97 million reports in the same period last year, marking a robust year on year growth of 24%. In terms of revenue, certification income stood at 588.8 crores, growing at 14%. This was driven by strong growth across all our key segments be it LGD which is growing 16%, natural diamonds 7% and LGD jewelry 35%. Total revenues therefore for the half year stood at 627.8 crores, registering a growth of 14%. Year on year driven by strong revenue performance and continued cost optimization. The PAT delivery for the half year stood at 267 crores, marking a growth of 31% PAT margins, therefore for the first half was at 44%. EBITDA at 369.2 crores showed a growth of 23% with a margin of 61%. Looking ahead, the company is accelerating. Actively ramping up its infrastructure to support the volume growth and we remain confident to delivering a strong performance in 2025. With that, I conclude my remarks and open the floor for your questions. Thank you very much.
Questions and Answers:
Operator
Thank you very much. We will now begin the question and answer session. Anyone who wishes to ask a question may press STAR and one on their touchstone telephone. If you wish to remove yourself from the question queue, you may press star and two participants are requested to use handsets while asking a question. Ladies and gentlemen, we will wait for a moment while the question queue assembles. The first question is from the line of Sheila Rati from Morgan Stanley. Please go ahead.
Sheela Rathi
Yeah, thanks for taking my question. Ishwar. My question was with respect to, you know, when we look at consolidated minus standalone numbers, you know, this particular quarter we have seen about a 6% growth. When we look at the margin profile, the margins are low single digit versus what we have seen in the last three quarters. Of course this is up year on year, but just that the trend is significantly lower. And even below the margins, also the number seems to be much weaker. Just wanted to understand the significance of this quarter with respect to the international market.
Eashwar Iyer
Okay. I think the international markets has performed very well from a Netherlands business standpoint. Obviously we still are seeing some softness both in the US as well as the Belgium business, driven by obviously the factors that is affecting the US business, specifically thanks to the tariff, etc. But our business in Netherlands is still growing over 20%. So there is an extremely strong performance both from the Dubai as well as the China markets. And we continue to see that momentum carrying forward from quarter one. Obviously the performance versus the previous year is still better. And we are therefore hoping that we see a turnaround probably in quarter three, quarter four as far as the US Business is concerned.
Sheela Rathi
Okay. And in terms of the mix, is the mix very different in this quarter versus what we see in the other quarter? And I mean, just trying to understand why margins in general are lower in this quarter
Eashwar Iyer
Versus the sequential quarter is what you’re saying.
Sheela Rathi
Yes. Yes. Ishwar.
Eashwar Iyer
Okay. See from a margin standpoint, I think we delivered at the consolidated level from 64%. Against that, I think we are now at. Just give me a minute. I think we reported 58%. Right. That’s what we reported for this quarter. And I think this is in line with what guidance we had given as part of quarter one as well. I think we had a significant ramp up of indie jewelry in quarter one. We’ve seen a slight slowing down as far as ND Jewelry is concerned in this quarter we delivered around 3.03 million reports versus 3.12. So there’s been a slight slowdown in jewelry this quarter which is normal trend. Normally we have a huge ramp up in the quarter four and quarter one. So that is one of the reasons. Additionally, I think you will also notice that we are making some significant investments to build up an AI architecture in the organization. So there is a bit of one off expenses that has got booked in this quarter. But again that is very important for the company. We’re making some strategic investments as far as building AI capability within the organization. So that is the reason these are investment that is being done from a long term standpoint. And that is the reason why you see a slight dip in the EBITDA margins. But we will remain with what we have forecasted at the beginning of the year between 57 to 64% EBITDA margin is what the company will deliver this year.
Sheela Rathi
Just one follow up prish. Again this is to do with the console ebitda margin, the 3.9% number vis a vis June 24.3% versus the double digit trend we have seen in the last two quarters. Just want to understand that in June quarter when we look at console, is there any specific mix here which results in such lower margins or this is just a one off and we should see improving trends?
Eashwar Iyer
No, I think it’s just a one off and I think from a mix standpoint there’s not been too much of change across segments. So I think we’ll just see, we’ll see some improvement as we get along the road because the business in the U.S. hopefully we should pick up now that we are into the season as far as the US business is concerned.
Sheela Rathi
Understood. All right, thank you.
Operator
Thank you, ma’. Am. The next question is from the line of Hareet Kumar from investech. Please go ahead.
Harit Kumar
Yeah, hi, good evening. So the first question was on this ASP measurement. So if you look at it, there has been some improvement sequentially on the ASP side. You know, just gives you gives a little bit of a sense that it seems like your ASP levels are stabilizing versus Q1 where they were down by about 12%. I just wanted to get a sense on pricing. Do you look at the fact that now barring mix ASP levels will have stabilized at this broad range of levels, at least for the near to medium term?
Eashwar Iyer
That’s right. I think what we had discussed during a quarter one call as well, Quarter one, we were cycling the price effect of. April, May on lgd, which we had spoken at length, the company is cycling that. So that the reason why you see sequentially the ASP is actually improved by some 3,4% at the India level, which is the key driver of the global revenues as well. So I think we see a lot of stability in the last three, four quarters. So we don’t foresee any dilution as far as ASP is concerned over the balance of this year.
Harit Kumar
Understood. And the second part was, you know, you did touch upon in the earlier question about, you know, some tariff related things on the Belgium subsidiary. But you know, US as a market affects everything, including your standalone business. Just wanted to get a sense of how you are seeing the situation, you know, currently. You know, could there be in quarter in the quarter going forward some kind of volatility in revenue given that there may be a stop start situation as far as this is concerned. Or you have another kind of view on that?
Eashwar Iyer
The last two quarters, especially this quarter versus the previous year, I think the tariff discussions happened sometime in March, April. We have seen stability, we have not seen any massive disruption. But we’re just hoping that there is some progress that happens on the trade deal because at the moment there is an additional 10% levy right. On the stones as well as the gold that goes out. So hopefully that stabilizes. It just clears out whatever little worries that the industry might therefore be facing. So we’re keeping our eyes open in terms of where that discussion is going between the two governments. But otherwise between the two quarters, you know, there’s not been anything that has actually cost any disruption as far as certification goes for our business.
Harit Kumar
Got it. The other one was on LGD Jewelry, I think Tamas in his opening remarks, you know, you mentioned that you are seeing a pickup even in India market. So if you could just give a sense of, you know, what are you seeing in the India market in terms of LGD Jewelry pickup? You know, what is the kind of pace of increase there and your role as certifier? Are you, you know, is your share, you know, almost as high in stone certification as far as well as jewelry certification in the India market? Just a little bit of sense of what’s happening in the India market for you.
Tehmasp Printer
Okay. The thing is, LG Jewelry is now the new growth factor that we are looking at. India has been a little slow on the acceptance of LG Jewelry, but it is gaining momentum very fast. US has been the first continent to have accepted LG. Last year US reported over 50% of all bridles with algae stones. Today what we are doing here is now we are creating an awareness among the in the Indian continent. To see increasing awareness creates transparency and knowledge. And that creates like, you know, that makes a consumer to take a buying decision. We grade diamonds and we give you the origin, whether it is lab grown or it is natural. Certification becomes a very important factor that you know, if you are buying natural, you need a certification to know for sure that it is not a lab grown. And if you are buying lab grown, you need to be sure that it is not a piece of glass. So your IGI is policing the entire market and giving the consumer the value for the money that he or she is putting in. And we see this momentum growing. I think we saw some significant growth in the lg. So what is that percentage?
Eashwar Iyer
This is on a, on a half yearly basis, some 6, 7% LG jewelry versus previous year.
Tehmasp Printer
No, no, but over the previous year.
Eashwar Iyer
Over the previous year for the quarter, quarter two is up on 35, right? 35, yeah. 35%. 35%. You know.
Tehmasp Printer
So every quarter the awareness is increasing and the LG jewelry acceptance is also increasing. And we are in the game. We are the largest.
Harit Kumar
Okay, got it. And one last question before I come back, Ishwar, is there any one off in the other income this quarter? It seems pretty high on a year over year or is this the cash balance impact?
Eashwar Iyer
Yeah, I think this is basically got to do with the accumulation of cash over the last 12 months, I think. So that is the reason why you’re seeing increase in interest income for this period. I’m presuming you’re looking versus previous year, right? I am, I am. Which is obviously the case because we generate like 300 crores every. Every year, so. So that is what is giving this impact from an interest income standpoint.
Harit Kumar
All right, I’ll get back for more. Thank you. Wish you all the best. Thanks. Thank you.
Operator
Thank you, sir. The next question is from the line of Aaron Armstrong from Ashmore Group. Please go ahead.
Aaron Armstrong
Hi, good evening. Thank you very much for taking the question. And congratulations on a very good set of results. Firstly, could you expand a little bit more on the tariff side of things, please? So when you serve the US market, could you talk about whether you do that from your assets in India or internationally, or do you serve that domestically within the US and how tariffs affect you in terms of either your competitiveness or in terms of kind of revenue and pricing.
Tehmasp Printer
Aaron, everyone is holding their breath on the tariff issue. You know, they’re waiting for the announcement. And I mean, tariff is something that is here to stay. I mean, there’s no two ways about it. And we are all, the entire industry is looking for innovations and ways to surmount this obstacle that is there. But the business is carrying on. Having said that, what happens is India is the center of manufacture. So and my New York offices, my offices in Europe, they are the marketing arm for our, for us. So they provide us the information of the market sentiments in the US or in Europe or wherever. And based on those requirements, we grade and certify the jewelry or diamonds, whether lab grown or natural in India. So while all the marketing effort is done from, is driven from the western source, the manufacturing and the cumulative collection invoicing is done in India. So you may see a little difference. But essentially it is because of these global offices that we have, we are able to certify manufacture and certify in India where we are very strong.
Aaron Armstrong
Got it, thank you. And so do you think you’ll be able to pass on tariff costs or are you currently passing on tariff costs to your customers?
Tehmasp Printer
No, no. See the tariff cost, t
Eashwar Iyer
There is no implication for IGI from a tariff standpoint. So that I think we have to just clarify to you. I think it’s a play between the manufacturers and the retailers. So IGI per se is not affected by tariff.
Tehmasp Printer
Yeah, per se. But you know, it will be distributed between the manufacturer, the retailer and probably in the end the consumer. So it’s a game that these guys have to play. We are certifying the goods that are being exported.
Aaron Armstrong
That’s great, thank you. And then a couple of other questions, if I may, please. Just firstly, on the other operating income line, so I can see for this quarter, it was at. 88 million versus 117 in the same quarter last year. Can you talk about that decline please?
Eashwar Iyer
That decline is basically led by some slowdown on the sorting business that we do in Europe. So we have seen a slight slowdown there in terms of we have large retailers like
Tehmasp Printer
We have large super brands who come to us for free, do the screening in Antwerp. We do nearly on a year, on year basis we do 20 million stones. But now we know the super luxury brands have also slowed down a little. And from that perspective the screening services has also got a little slowdown there.
Aaron Armstrong
Okay, that’s great, thank you. And then sticking with the consolidated numbers, if we look at for Q2 of this year, the cost control has been very strong and you’ve had a decrease in cost on employee benefits expense, on your depreciation expense and then on your other expenses line as well. Can you talk a little bit about where those cost savings are coming from and whether they’re sustainable for the rest of the year?
Eashwar Iyer
I think the cost will be sustainable at these levels around for the balance of the year versus the previous year. We had taken a one time charge in 2024 in this quarter of last year, consequent to a slight severance that we did in our US business. So that’s the reason why you see a flat expense on employee benefit or slightly lower cost on employee benefit than previous year on amortization. This is more a local gap requirement which is about taking a charge on lease offices, etc. We had actually two offices in lease in the US same time last year. So we are coming to the end of the lease in one of the offices. The other office is where we will continue to operate. And that’s the reason why you’re seeing a slight decline in D and E expenses. The other expenses have remained more or less constant at the same levels as last year and that trend should therefore continue as we get along the road.
Aaron Armstrong
That’s great, thank you. And then one point that I think you touched on, maybe some more detail would be helpful, please, just on your average realizations. So the 963 number that you’ve posted for this quarter down 3% YoY, is that just mix driven? So are you making a lower average realization say on LGD versus ND or on diamond versus jewelry? Can you talk a little about that mix effect please? And on a like for like basis, do you see most of your pricing is stable right now for the rest of the year?
Eashwar Iyer
Yeah, I think the pricing has been extremely stable over the last two three quarters, and we expect that to continue as we get along for the next two quarters. The slightest. A dip that you’re seeing, Aaron, is we’ve seen a large chunk of smaller sized stones for natural diamond which is common during this quarter. So those are dossier reports versus the full diamond reports that we give to natural diamonds. So that’s the reason why if you look at my natural diamond business has grown 14% and that is consequent to smaller sized stones coming in for certification. And that’s what is causing a slight dip in the average realization price. But the volume is more or less taken care of, the slight dip as far as natural diamond is concerned and overall revenue has therefore grown at around 14%. So I think that is the major reason why the ASP has actually declined by some 2, 3% over the same time last year.
Aaron Armstrong
That’s great. Thank you. And one final question if I may please. Just on the outlook for pricing, as you look towards 2026, do you think you’ll be able to sustain current prices?
Eashwar Iyer
We hope to too early in the day, but we’re seeing a lot of stability in the market. So if things remain the same, I think we should therefore look at the same realizations as we get along into 2026.
Aaron Armstrong
That’s great. Thanks again for the call and look forward to keeping in touch. Thank you. Thank you.
Operator
Thank you sir. Ladies and gentlemen, to ask a question please press star and one now. Participants who wish to ask questions may please press star and one at this time. The next question is from the line of Harish Advani from Access Capital. Please go ahead.
Harish Advani
Hi, thank you for taking my question. My first question was on the India NGD business. So we have seen a pretty strong pickup sequentially. So this 24%, can you break it down into how much of this has been volume led and how much of an impact we had from the pricing because we took pricing cut last year this time.
Eashwar Iyer
See, I think the volumes have grown more or less in sync with revenue. Both of them are growing around 24% and that’s what you see in the financials as well. And as I mentioned, we are now back to the same price levels current versus the same time last year. So the volume, the revenue growth has mirrored the volume growth during this period. So it’s all on the same levels. 24% is the volume growth as well.
Harish Advani
Okay, perfect. Thank you. And if I were to talk about the subsidiary business, which is console standalone, you kind of indicated that this quarter there was a bit of pressure and that’s why the margin has come up from 20 to about 4. But we had a similar kind of an impact last year where the margin was about 3%. So is this more? It’s kind of a season. And if that is the case, what should we kind of build in for the rest of the year on the full year CY25 for the international business,
Eashwar Iyer
I think you must build in whatever we have seen as the first half growth. We hope that the US business will start to move the needle up. But the Netherlands business is continuing to grow over 20% as we speak. So you can build in the same levels of growth as we get along for the balance of year. But overall, as we’ve mentioned earlier as well, the company had given a forward looking statement of a 15 to 20% growth from a revenue standpoint and this quarter performance has been an 18% revenue growth and that has brought this, the first half growth to close to 15%. So we are confident of delivering to what we had committed at the beginning of this year which is a 15% to 20% revenue revenue growth.
Harish Advani
Perfect. And just one last question. So if I were to look at the console margins of last year of about 49 odd percent, can we say that this margin which we delivered in 58 is more or less come off a low base and ideally margin should remain in the ballpark of 57 to 64 that you mentioned. Is that a fair assessment?
Eashwar Iyer
Okay. I think we should look at that range. Yes.
Harish Advani
Okay, perfect. Thank you. That was my questions.
Operator
Thank you sir. The next question is from the line of Angad Kadari from Samiksha Capital. Please go ahead.
Angad Qadri
Hi sir. Thank you for the opportunity and congratulations on the good set of numbers. Most of my questions have been answered. My follow up question is just on the number of employees. What is the current count of employees currently and how many gemologists out of that?
Eashwar Iyer
So I think at the global 1300, around 1300 people would be the total employee strength. And I think all the lab facilities will close. A thousand lab, back office, everything. Okay? Yeah, I think all of it would be close to within 900 to 1,000 people.
Angad Qadri
Got it. Thank you.
Operator
Thank you sir. The next question is from the line of Harsh Shah from Avenir Capital. Please go ahead.
Harsh Shah
Hello, I’m audible. Yes sir. Yes sir. Yes you are. Thanks for taking my question. Just wanted to know of the demand trends in the third quarter. Like already the first month has passed. We are not seeing anything very different.
Eashwar Iyer
Harsh, we are not seeing anything different in July versus the performances that are. Seen in quarter two early days for the quarter but the business continues to be stable.
Harsh Shah
Okay. Okay. And rest of my questions have already been answered. Thank you.
Operator
Thank you sir. The next question is from the line of NATIC from NV Alpha Fund. Please go ahead.
Naitik Mutha.
Hi sir, thanks for taking my question. So I just wanted to understand our employee costs a little better. While I appreciate that year over year it has fallen but if I look at it sequentially know the range had been 65 per quarter roughly which has gone to 71. So just wanted to understand where, where does this stabilize and are there any one offs in, in this 71?
Eashwar Iyer
Okay. See the 71 versus 65 is consequent to two things. One is the annual increment impact. Plus we had mentioned in the last call that we’ve you know added some 250, 300 people over the course of the last few months. So that is the reason why this cost has actually gone up. We expect this cost to remain the same level for the next two quarters because I think we are at the end cycle as far as recruitments are concerned. So I think we are now back in as far as meeting customer expectations from a timeline standpoint. I think we are now adequately resourced to manage the volume growth at least for this year.
Naitik Mutha.
You mentioned you have done some one time investments which are sitting in other expenses. So just wanted to understand that also because even that if I see sequentially on a similar revenue base that has also gone up substantially. So just wanted to understand that
Eashwar Iyer
That will probably stabilize slightly lower in the subsequent quarters. Because this is just a, you know, a chart that we taken this month for the project that we are embarking on. I think 56 crores. I think we should probably get back to the 50 crore level.
Naitik Mutha.
Right? Got it sir. That’s it from my side. Thank you.
Operator
Thank you sir. The next question is from the line of Shravan Poora from Morgan Stanley. Please go ahead.
Shravan Vora
Hi sir, thank you for the opportunity. So I had two questions. First one you mentioned briefly about capability building to handle higher volume. So could you talk briefly about that what kind of capabilities you are building on the AI side and the gemologist side.
Eashwar Iyer
This is basically recruitment of gemologists that we did in between in the first four, five months of this year. These are basically gemologists graders that we have recruited. Plus obviously we have also built up some capability or number of people both in our back office as well to manage the business growth requirements.
Shravan Vora
Got it. And secondly sir, if you could talk about your brand building initiatives that you had spoken last time also both in India. And in the US to get more retailers on board in the us. So anything, any updates on that?
Tehmasp Printer
So most importantly you will know that, you know the India exhibition, the largest exhibition in India is just started today in fact. And we are showcasing our new different services at the exhibition. And of course we are in the routine business of creating a brand awareness where the IGs concerned and also to enhance the services that we provide. So it’s a culminative exercise that we are doing in a holistic manner. So you know, we are getting to the entire supply chain, right? From the manufacturer to the wholesalers, to the retailers to the consumers. And that is what we are doing currently. And more importantly in the India market, we are trying to create more awareness and transparency regarding diamonds. There is a lot of negative chatter going around but we say that both LG Lab grown as well as natural, both are diamonds. And it is extremely important to identify the origin. And we have the capabilities and the scalability of identifying this origin and that is what we are depending on.
Shravan Vora
Right, Perfect. Thanks a lot sir. Thank you.
Operator
Thank you sir. Ladies and gentlemen, to ask a question please press star and one now. Participants who wish to ask questions may please press char and one at this time. The next question is from the line of Sumit Sarda from Compound Everyday Capital. Please go ahead.
Sumit Sarda
Yeah, hi, I’m Audible. Yes. Yes sir. Yeah. I have two questions. First is what is the net cash on the balance sheet? And it was mentioned that generally we generate around 2,300 crores of cash every year. So how do you plan to allocate it in for example growth also returning to shareholders if any. That is first question. Second question is you mentioned that you are investing in AI capabilities. A larger question is how does AI improve accuracy, cost effect of certification and what are the early trends you are looking at? Is there a. Can that be a game changer for our business? Third would be would you maintain that 15 to 20% volume guidance for the year? Thank you.
Eashwar Iyer
Yeah, I think so. There are three questions that you’ve asked so. Number one, the cash balance I think is in excess of 750 crores now in the company. And as we have indicated earlier as well, we will be seeking guidance from the board as far as dividend declarations are concerned. That is actively in consideration for the management. And number three, in terms of the growth which I had earlier articulated during the call, I think we will stick to the guidance of 15 to 20% revenue growth for this year.
Sumit Sarda
Just to follow up on the capital allocation, how do you want to invest it in the business? Are there lot of opportunities, for example, setting up new labs, new kinds of labs
Eashwar Iyer
Which we are doing currently. We have opened a couple labs in the last couple of months. Yeah. But again, from a larger context, I think the company continues to evaluate opportunities for acquisition, etc. I think that is always on the radar in terms of how we could therefore deploy the capital that we have for bringing in some inorganic growth. So those considerations will continue to be evaluated.
Sumit Sarda
The last question was on AI and its impact on our business.
Eashwar Iyer
AI? Oh yeah, of course. I think I missed that. Sorry. I think that’s what we want to engage in that journey just to ensure that we are aware of the development that’s happening in the global environment as far as AI is concerned and we don’t miss the bus in terms of some of the opportunities that therefore exist. So we are commencing a project there. We’ll see how that goes. It’s more about discovery and therefore implementing some of those automation stroke AI measures within the organization for effective delivery delivery and improving effectiveness as an organization.
Tehmasp Printer
Shorting our service delivery.
Sumit Sarda
Yeah, got it. Just final question on the effective tax rate, it was around 28%. Should we maintain that or it can be lower for the year.
Eashwar Iyer
I think just maintain. I think there’s nothing that’s going to happen significantly different in the balance of the year. I think you just continue to maintain at the same percentage.
Sumit Sarda
Okay, that’s all. Thank you. All the best.
Operator
Thank you. Sir, the next question is from the line of Raman from Sequent Investment. Please go ahead.
Raman Venkata Kerti
Hello, sir, can you hear me? Yes. So my question is with respect to the recent step taken by Gaa Gai with respect to 4C grading or for lab grown diamonds, they have completely. I guess they have stopped OC grading for lab grown diamonds, which is. So I just wanted to understand what is the market opportunity for someone like us with respect to this, the competition being. One of the key competitors stopping this particular segment.
Tehmasp Printer
Raman, this is a very good question. See right now understand one thing. Lab grown is the biggest disruptor which has happened to the industry in the last hundred years. Okay? Four C’s is a, is the four CS is the analysis which has been there for the last century. Okay? Now we at IGI are principled to be an independent certifier. We are not governed by any external influences. We are able to certify a diamond and we give the origin. Today we not only give the four Cs on both natural as well as on lab grown because that is what the diamond is and that is what the consumer understands. It is very important to know the origin because you know, if you’re buying a natural diamond, you want us, you want to assure yourself that there is no lab grown in it. And IGI does that. If you want to buy a lab grown diamond, you want to be sure that there is no piece of glass and IGI certifies that. So our stance is that we are a neutral body. We do not want to have any preferences or biases against any gemstone or diamond. So we will continue to keep to our independent status and continue to educate and inform the consumer that a spade is a spade, period. Something like that.
Raman Venkata Kerti
So my understanding is. So what is the. I just wanted to understand size with respect to 4C grading for lab grown diamonds.
Tehmasp Printer
So we, we have virtually 65, 70% of the lab grown diamonds which are graded against the four C’s you know, today. Oh yeah. So lab grown diamonds of course, because we give what the consumer wants. We are not. Yeah, we are not. I mean opinion makers. I am giving you consumer wants consumer is familiar with and that is what we are doing.
Raman Venkata Kerti
Okay, Yeah, I understood sir. My second question is with respect to the average cost of lackron diamond. You have said it has, it has been stable for the past two to three quarters. So I just wanted to understand the scenario whether there is a possibility of the labylon diamond prices going down further or the manufacturer won’t be able to. produce the Labrum diamond if there is any further decline in the prices.
Eashwar Iyer
I think we have articulated this in the past as well, Raman. I think at the current prices at which it’s trading at the wholesale level, we estimate that their returns on their investment is between 8 to 10%. That leaves them with very little room to further drop prices. And that’s why we have also seen that sort of stability in the last couple of quarters. So I think, I think we are seeing the end at the bottom end as far as pricing correction on lab grown diamonds is concerned.
Raman Venkata Kerti
So there won’t be any further pricing correction and which will necessarily mean we don’t really have to take any other like average price realized size for us.
Eashwar Iyer
That’s what I just indicated in my call.
Operator
Thank you. Thank you. Thank you, sir. Ladies and gentlemen, to ask a question please press star and one now. Participants who wish to ask questions may please press star and one at this time. The next question is from the line of Smith Gala from RSPN Ventures. Please go ahead. Y
Smith Gala
Yeah, first question is average revenue per certificate. Should we look at the number sequentially or year on year?
Eashwar Iyer
You can look at it both ways, Smith. The reason why we talked about the year on year number is because there is, there was a pricing correction that happened last year. So there were a lot of queries in terms of the ASP performance in quarter one versus the previous year where you were cycling a price reduction of quarter two last year. So you can therefore look at it from that standpoint also from a sequential standpoint. We have mentioned this in the past. While the overall volumes remains more or less stable across quarters, there is obviously a mix element that comes into play. There are quarters like the Diwali quarter where we have a spurt in jewelry certification. There is a first quarter of every year which is a larger LGD mix. So those impacts on the ASP will continue. But otherwise, from a pure realization standpoint, if you were to disregard the mix impacts, we are seeing a lot of stability as far as the price that we charge to our customers.
Smith Gala
Okay, thank you. That was helpful. That’s also on my side. Thank you.
Operator
Thank you, sir. The next question is from the line of Chintan Seth from Girig Capital. Please go ahead.
Chintan Seth
Hi. Hi. Am I audible? Yes. Yeah. Hi. Hi. So the question is on the finance and the GR strategy to move, you know, standardize the LGB does, do you foresee any risk on, you know, full sledge certification demand to move to a minimalistic certification and that impact our overall realization in the future?
Tehmasp Printer
See, Chandan, when we we were the first to adopt lab grown certification, us adopted first the lab growns. GI in fact didn’t want to certify lab growns initially. And then they saw the market volume and they also got into lab grown certificate. Okay. And they have been also doing. But I think that they couldn’t match up to the IGI standards. See, IGI has the expertise to identify the origin and the scalability to identify the origin on a scale of lab growns is immense. And we have developed that scalability. So when they saw, I mean, suddenly they’ve taken a U turn that we will stop grading. Okay? So I cannot say anything much, but I can only use it to my advantage, which I am doing. The consumer has the right to know the choice to decide. It is not a laboratory. Laboratory is an independent entity which gives you the analysis period. Right? Okay.
Chintan Seth
But how is the price differential between our full scale certification and the bigger certification differential between full scale certification versus minimal certification, which we do internally as well for our clients?
Tehmasp Printer
See, GI has not announced any indication of what they’re going to price. All they have announced is their indication that they will henceforth do a premium or a standard, you know, right. To minimize. See, this is essentially minimizing a category and we don’t believe in that.
Chintan Seth
No, no. I am asking within yourself, IGI report. Within IGI report, there is a full certification which also includes laser infants and the diamond. Right. Versus a minimal. Minimal certification, which is more doses driven certification, which still carries PROC certification but doesn’t provide more details on the laser imprints on the stones. What is the price differential between these two reports?
Tehmasp Printer
See? No, the price differential issuer will explain to you. But the thing is the analysis is the same whether it’s whatever the format of the certificate. We do the analysis. We also do the laser inscription on both. You understand? Right? Right. So it’s the format which is different, but the basic analysis is the same. And the dossiers are generally used for smaller diamonds. And that is where the, you know, a dossier fee is less than a full diamond report fee. So that is the advantage that you know, when you’re doing smaller diamonds, you take a dossier anything
Chintan Seth
On the price differential if you can highlight.
Eashwar Iyer
I think we mentioned this in the past. I think our jewelry certification realization around just under $4, which is basically $it.
Tehmasp Printer
The retailer knows the four Cs, the consumer knows the four Cs. And this is a new entity which GI has introduced and people are uncomfortable and confused. IGI, there is no confusion. We give you the standard four CS and we give you the origin which is the most important. Today origin has become even more important than the 4Cs because the 4C’s continue to remain the same for lab grown damage as well as for natural. However, origin is of paramount importance and that is where we have the expertise to differentiate.
Chintan Seth
Okay, so are just to sum it up, are any clients looking to switch over from GR to igi?
Tehmasp Printer
We are seeing that trend though it’s a very small number because you know, we have the bulk of the certificate. Certification nlg.
Chintan Seth
Okay, perfect. Thank you. Thank you. Okay, t
Operator
Thank you. Ladies and gentlemen, due to interest of time, that was the last question. I now hand the conference over to management for closing comments.
Eashwar Iyer
Okay, thanks everyone, for taking the time. And I see that we still have a few questions unanswered. You are open to reach out to us on email, etc. And we will be happy to take those clarifications as well. So thanks again, as always, for your active contribution and participation in these calls. Thank you very much.
Tehmasp Printer
Thank you, everybody. T
Operator
Thank you, sir. On behalf of International Gemological Institute India Limited, that concludes this conference. Conference. Thank you for joining us. And you may now disconnect your lines.