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Shrenuj De Beers Sight Suspended
Nov 23, 2016 11:53 AM
By Rapaport News
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RAPAPORT... Shrenuj & Co., one of India’s largest diamond cutting firms, said its supply arrangement with De Beers has been suspended, and its Botswana
operations were scaled back amid continued pressure on its liquidity position.
“In the recent few
months, we have been facing strong headwinds in our business, largely due to
external factors, including rising input costs, weakening of the Indian rupee,
and a stagnation in demand in some of our key markets,” Vishal Doshi,
Shrenuj’s executive director, explained in an email to Rapaport News. “These factors strained our liquidity
and compelled us to downscale our operations to sustain the business.”
Shrenuj announced in June it was “rationalizing”
its workforce and a month later was forced to issue a clarification to the
Bombay Stock Exchange following an order by India’s debt recovery tribunal to seize its
assets. The company reported sales fell 34 percent to $265.7 million (INR
17.89 billion) in the fiscal year ending March 31, contributing to a $6 million
loss.
Shrenuj opened its Botswana operations in 2010 as De Beers
incentivized companies with rough supply in Gaborone to help grow the African
nation’s diamond manufacturing sector. While Shrenuj’s sight was suspended in
July, the company is currently in talks with De Beers to resume the supply deal,
Doshi stressed. That would enable the company to increase its operations in
Botswana as soon as possible, with activity expected to resume normalcy after
the holiday season, he added.
“We have adequate
management bandwidth and access to additional resources to overcome these
issues," Doshi said. “Our business is deep rooted with very strong
fundamentals and is adequately capitalized to run efficiently.”
De Beers declined to comment on customer contractual issues. |
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Tags:
Bombay stock exchange, Botswana, gaborone, India’s, Rapaport News, Shrenuj, Shrenuj & Co., Vishal Doshi
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