The reason lies beyond the obvious. Though the past five years have not been the best of times, that is not the reason. In most other industries, a record-breaking turnover ($5 billion) and an increase in marketshare in the face of intense competition would have had analysts and punters gunning for the listed companies. Here the attitude is cool.

As analysts put it, "The industry has not grown with the times. There has been no lateral or vertical growth. On the basis of sales, a mere 20 per cent of the industry is corporatised, most of it since a long time. Listed companies do not show returns in performance or stock prices.

They are reluctant to divulge even basic information. In today's times, with the market upbeat and the options available, which investing community will stand for this?"
A valid point indeed. Diamonds are no longer the single star performer in the exports basket. The government's cavalier attitude -- periodic changes in export credit and an unsympathetic indirect tax structure -- is admittedly a factor in the situation. But the markets hold even this against the industry, as not arguing its case effectively. From the market's viewpoint, the listed diamond corporates are a motley collection and analysing their performances with any degree of accuracy is made arduous due to a variety of reasons.

There is the family-oriented nature of the business and lack of transparency under which the industry operates. Annual reports are terse and skeletal in nature. Adding spice to the situation is the attitude of companies like Su-Raj Diamonds which, between March 1996 to March 1999, have obliged the shareholders with only two annual reports at intervals of eighteen months. The latest is under preparation.

Yet, some trends do emerge. Analysis of the available balance sheets shows that operations are demanding more and more working capital. But, Shrenuj's emphasis on monitoring working capital seems to have paid off. The holding period of finished goods has dropped in this period from 162 days to 115 days.

But on the other hand, the collection period which had improved from 46 days to 41 days again went up to 47 days last year. A good sign is that the interest outgo is on the decline, both on long-term debt as well as on cash credit. The net working capital cycle has reduced from 278 days to 244 days. Classic has also concentrated on working capital management.

But overall, there have been too many contradictions. Where Shrenuj's net cycle has decreased, it has increased for Classic, and more dramatically so for Suashish Diamonds. In times of growth, Shrenuj had witnessed a slight fall in turnover.

All this lends credence to the general opinion that, with the existence of a plethora of group entities, no one can be sure about which aspect of the business trend will get reflected in which particular company's workings.

Hence, there is little to be said. In bad markets, industries like this find themselves more out of favour. So far, the great performance shown by the industry in 1998-99 has not come across in the balance sheets of listed companies. No company talks of great plans for the jewellery segment, of growth strategies and new markets.

Till that happens, till shareholders get returns accordingly, and till the time there are more disclosures by companies, there is no reason for the outlook to change, bull market or otherwise.