Surat: De Beers SA, the world’s biggest producer of rough diamonds, plans to more than double the size of its retail network under the Forevermark brand name to 4,000 stores by 2020 from about 1,600 now, according to Forevermark chief executive Stephen Lussier.

In India, the number of stores will rise to 200, from 160, in the same period, Lussier said on Tuesday at the inauguration of the International Institute of Diamond Grading and Research (IIDGR) in Surat, where 90% of the world’s roughs are processed.

The plan by De Beers, with sales of $6.7 billion in 2014, to expand its retail chain marks a shift in strategy to investing more in promoting and building its own brands, Lussier said. “We want to create strong diamond brands that can compete with themselves. Since 2004-2005, this basic strategy had been aligned to promote our own brand, but it is being implemented recently," he added.

The plan comes at a time De Beers is changing the way it sells most of its diamonds.

The diamond group, which sells $6 billion of unpolished diamonds annually and is the world’s largest supplier by value, is introducing tougher rules for companies wanting to join its coveted group of customers known as “sightholders", the Financial Times reported on 29 March.

Only about 80 companies—most from traditional diamond trading and polishing centres such as Antwerp, Israel or India—are approved by De Beers to become sightholders and take part in regular sales, or “sights", each year where they buy rough stones.

Under new rules expected to be announced this week, sightholders will have to present their accounts according to international standards. De Beers will also insist customers hold a specified proportion of equity in their businesses, making them less reliant on bank borrowing, the report said.

“We are future-proofing the diamond business. This will bring in transparency. Many banks find the financials of the diamond industry opaque, currently. So, we want to make our sightholders strong financially," Lussier said, adding that once the sightholders have strong balance sheets, bank financing will be easier.

Uncertain diamond pricing has made banks tighten lending to areas perceived to be high-risk.

De Beers has invested about 60 crore to set up the Surat facility, which is equipped with the latest technology developed by Forevermark.

The centre’s primary purpose is to select and inscribe Forevermark diamonds with a unique serial number that symbolizes Forevermark’s promise of quality. It has a capacity to process $500 million worth of diamonds annually.

De Beers may also open a rough diamond auction-cum-sales office in Mumbai once India puts in place enabling guidelines for duty-free zones, according to Philippe Mellier, CEO, De Beers Group, who gave no details.

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