Lab-Grown

Q&A: Jayen Shah, Founder of Mavuca Capital Advisors

Lab-GrownOct 19, 2022

Q&A: Jayen Shah, Founder of Mavuca Capital Advisors

National Jeweler chats with the career banker about the prospects for the lab-grown diamond industry and financing options.

20221019_Jayen Shah.jpg
Jayen Shah, CFA and founder of Mavuca, started his professional career in 1995 with Kotak Mahindra Group. He has held various leadership positions at ABN AMRO, Rabobank, The Royal Bank of Scotland PLC (Singapore branch) and Standard Chartered Bank. He joined IDFC bank in 2011. Under his stewardship, IDFC was named Best Bond House–India, 2015 by IFR-Asia.
Mumbai—A tech-enabled investment banking firm, Mavuca specializes in both debt and equity funding. 
 
Over its short history, Mavuca has successfully executed 19 fundraising transactions, grossing more than INR 70 billion (more than $850,000) for marquee clients including L&T Group, KKR’s Virescent Renewable InvIT, JSW Steel, Welspun Enterprises and Shapoorji Group, among others. 
 
National Jeweler recently caught up with the firm’s founder, Jayen Shah, via email to seek his views on the lab-grown diamond industry. 
 
Here’s what he had to say.
 
National Jeweler: Why is the lab-grown diamond industry considered a sunrise industry?

Jayen Shah: Millennials and Gen Zers constitute probably the biggest growing demographically similar consumer segment. 
 
Their consciousness toward environment, ethics and cost has triggered quickest acceptance and adoption of lab-grown diamonds. 
 
On the other hand, lab-grown diamond technology has been around for more than 60 years. However, it is only recently that advancements in technology have made high quality, affordable lab-grown diamonds a reality. 
 
On the cost front, experts opine that lab-grown diamonds are [significantly less expensive than] mined diamonds. Early adoption of lab-grown diamonds has been witnessed in the United States and Western Europe. 
 
NJ: What is the market size of lab-grown diamonds globally and in India?
 
JS: Various estimates suggest that in 2021,lab-grown diamond sales have surpassed $6 billion and out of this, India’s contribution was $1.3 billion.  
 
The market size of lab-grown diamond jewelry in 2019 was a meager 2 percent of [total] diamond jewelry [sales], which is expected to be up 8 percent [year-over-year] in 2022. 
 
Some credible analysts project lab-grown diamonds to be a significant 25 percent of the diamond [market] in five years. Growth percentages are stupendous. 
 
Besides jewelry, 5G networks, computer chips, and satellites use these materials. Thus lab-grown diamonds’ growth is likely to experience significant demand surge due to its multiple uses.  
 
NJ: What are the advantages to Indian manufacturers? 
 
JS: Realizing the immense potential of lab-grown diamonds, the Indian government, after the successful rollout of PLI (production linked incentives) schemes for 14 sectors, is now in discussions for introduction of similar incentives for lab-grown diamond manufacturing along with two more sectors, bicycles and toys.
 
The extant PLI schemes have a proposed outlay of INR equivalent of $24 billion and aim to create 6 million jobs in the next five years. The launch of the PLI scheme is further likely to boost lab-grown diamond manufacturing in India.
 
Further, the RBI notification from July 2022 on International Trade Settlement in Indian rupees is [designed] to boost international trade for India. The lab-grown diamond sector may reap the benefits of relatively stable exchange rates for its capital goods imports. 
 
For exporters, export-import trade being settled in INR will even out the uncertainties of forex fluctuations and enhance the operational convenience.
 
 Related stories will be right here …
 
NJ: What financial constraints do Indian manufacturers face in terms of capacity expansion? 
 
JS: The Achilles’ heels for any sunrise industry are some of  the usual “teething” problems, such as: 
  1.  Time taken for technology stabilization, product adoption and quality framework;
  2.  Volatility in product pricing; 
  3.  Limited or non-availability of “seconds” market;
  4.  Fragmentation of market players; 
  5.  Higher financial risk-reward; and
  6.  Perception of enhanced credit risk.
Some of the Indian banking and financial institutional lenders have taken initial steps to analyze and model these risks. These lenders, with suitable mitigating factors and “margin-of-safety” have lent funds toward setting up lab-grown diamond manufacturing facilities. 
 
NJ: What are the highlights of these financing initiatives?
 
JS: Taking a step back, components of lab-grown diamond manufacturing facilities include: land, building, machinery, technology, back-up power facilities, supporting infrastructure, etc. 
 
Plus, a steady energy supply is an absolute must for any lab-grown diamond manufacturing facility. 
 
Another differentiating factor is the type of technology used to grow diamonds in the laboratory. It could either be the  high-pressure, high-temperature (HPHT) process or chemical vapor deposition (CVD).
 
The cost of machinery to set up a manufacturing unit is significantly higher for HPHT as compared with CVD. Users of both technologies strongly advocate respective project viability, pay-back period, and ROIs. 
 
Several early movers have been the public sector banks, like the State Bank of India (SBI). SBI has already shown interest in financing such brownfield/greenfield projects. 
 
Some of the financing highlights are as follows.
  1.  Financing format: term loan 
  2.  Tenure: up to seven years
  3.  Amount of loan: up to 70 percent of the project cost. However, many lenders require cost of land purchase to be funded from promoters’ equity.
  4.  Loan repayment with principal repayment moratorium for 12-18 months and, thereafter, principal repayments customized to projected cash flow generation.
  5.  Financial covenants linked to operating parameters, such as debt/EBIDTA and/or debt service coverage ratio (DSCR)
  6.  Security: first charge of land, plant and machinery 
  7.  Ratings: lenders prefer to have investment grade rating from SEBI-registered rating agencies.
Lenders will require a quality technical-economic viability (TEV) study with detailed project report (DPR). 
 
Lenders will weigh on other qualitative factors, including management strength, technical expertise, technology type, equipment manufacturers, etc. Every financing case may have its specific transactional customization. 
 

NJ: What about working capital financing?
 
JS: Some of the major operating costs of a lab-grown diamond manufacturing facility are electricity, scientists, skilled technicians, machinery maintenance, seeds and general administrative costs. 
 
These accumulate to a relatively smaller proportion, though another major component that adds to the working capital is the credit period provided to buyers. 
 
Several financing options exist, such as receivables discounting, factoring, and bank working capital financing for financial management of the receivables.  
 
Also, the lab-grown diamond industry is a power guzzler. Therefore, the cost of [electricity] is very high. For long-term project viability and sustainability, lab-grown diamond manufacturers may consider long-term power purchase agreements with renewable independent power producers.
 
 This story is one of three included in the special India Diamond Report newsletter. The stories are produced  by an independent editor based in India. 
Anil PrabhakarAnil Prabhakar is an industry analyst, journalist and consultant associated with the Jewelry and watch industries.

The Latest

A Vanitas by Hannah Martin and Guy Berryman Sothebys
CollectionsJul 22, 2025
Jewelry With a Rock ‘n’ Roll Aesthetic Heads to Sotheby’s London

Next week, the auction house will kick off a selling exhibition of jewelry by British artist Hannah Martin and Coldplay’s Guy Berryman.

Cover of the book “Flawless: Inside the Largest Diamond Heist in History”
SourcingJul 22, 2025
Antwerp Diamond Heist Documentary Coming to Netflix

“Stolen: Heist of the Century” is based on “Flawless,” the book about the middle-of-the-night theft, and will debut on Netflix in August.

Emmanuel Raheb
ColumnistsJul 22, 2025
The Gifting Gap: How to Market Jewelry Beyond the Holidays

Emmanuel Raheb shares the top five gifting moments outside of major holidays that jewelers should build marketing campaigns around.

rio-article photo-diamond.jpg
Brought to you by
Taking the Moment Head On: How Rio Grande Champions the Present & Future of Fine Jewelry

As a leading global jewelry supplier, Rio Grande is rapidly expanding and developing new solutions to meet the needs of jewelers worldwide.

NY Now
Events & AwardsJul 22, 2025
NY Now’s Summer Market Returns in August

The wholesale trade show’s Luxury Lifestyle section will showcase established and emerging jewelry designers.

Weekly QuizJul 17, 2025
This Week’s Quiz
Test your jewelry news knowledge by answering these questions.
Take the Quiz
Jeweler setting a diamond into a ring
MajorsJul 21, 2025
Rio Grande Expands Personalization Offerings

As demand for custom jewelry grows, the company is expanding its services to support retailers.

National Associate of Jewelry Appraisers Logo
Events & AwardsJul 21, 2025
NAJA’s 2025 ‘Ace It’ Conference To Go Virtual

The mid-year conference for jewelry and watch appraisers is slated for Aug. 9 to 10 on Zoom.

an instructor and a student in a bench jewelry classroom
Brought to you by
Investing in the Next Generation of Bench Jewelers

The Seymour & Evelyn Holtzman Bench Scholarship from Jewelers of America returns for a second year.

Jacquie Aiche graduated turquoise beaded necklace
TrendsJul 21, 2025
Amanda’s Style File: Graduated With Honors

Graduated stones make for elevated tennis-style pieces and dramatic statement necklaces.

24th Gem Awards Show Logo
Events & AwardsJul 21, 2025
Gem Awards Now Accepting Nominations for 2026

Nominations in the categories of Jewelry Design, Media Excellence, and Retail Innovation will be accepted through July 30.

Lewis Heyman
MajorsJul 18, 2025
Lewis Heyman on Sourcing Gemstones, Post-Retirement Plans

He retired last month after 28 years traveling the world to source the very best gemstones for his family’s jewelry business, Oscar Heyman.

CCWW Designs Multiple Shell Charm Necklace
TrendsJul 18, 2025
Piece of the Week: CCWW Designs’ Shell Charm Necklace

The charm necklace features six nautical charms of shells and coral that founder Christina Puchi collected on Florida’s beaches.

The Plumb Club board members
MajorsJul 18, 2025
Plumb Club Elects New Board Members

The organization elected its youngest vice president as it looks to draw in fresh talent.

Jewelry industry veterans Brad Campbell and John Liebler
TechnologyJul 18, 2025
Brad Campbell, John Liebler Join Clientbook’s Executive Team

Campbell joins the company as vice president of business development while Liebler is the new vice president of operations.

Silver, Gold, and Bronze Medals for Italy Olympic Winter Games
CollectionsJul 17, 2025
2026 Winter Olympic Medal Design Symbolizes Unity

The medals feature a split-texture design highlighting the Games’ first time being hosted by two cities and the athletes’ journeys.

vimeo screenshot.png
Supplier BulletinJul 17, 2025
The INSTORE Jewelry Show 2025: Your Holiday Preparations, All Wrapped Up!

Sponsored by The INSTORE Jewelry Show 2025

Guinness
SurveysJul 17, 2025
The Most Recommended Brands in the World, According to YouGov

Globally, travel and transportation brands reigned, while in the U.S., alcoholic beverage companies and a lingerie brand took the top spots.

Gina Ferranti
IndependentsJul 17, 2025
Gina Ferranti of GiGi Ferranti Jewelry Dies at 59

The Brooklyn-based jewelry designer is remembered as a true artist and a rare talent.

Rio Tinto Chief Executive Simon Trott
SourcingJul 17, 2025
Rio Tinto Names New CEO, Production Rises at Diavik

Production at the mine in Canada’s Northwest Territories topped 1 million carats in Q2, the third consecutive quarter of growth.

Jewelers of America Learning Workship Logo
Events & AwardsJul 17, 2025
JA to Hold Learning Workshops This Fall

A new slate of Learning Workshops will take place in Oklahoma, Mississippi, and Georgia.

Gold bracelets and bangles
SurveysJul 16, 2025
Signet Jewelers Falls Lower on NRF’s ‘Top 100’ Retailers List

The middle class is changing its approach to buying jewelry and affordable luxury goods, the NRF said.

Buccellati Opera high jewelry bracelet
FinancialsJul 16, 2025
Richemont’s Jewelry Sales Up 7% in Q1

It marks the third consecutive quarter of growth for Cartier, Van Cleef & Arpels, Buccellati, and Vhernier.

Rolex Datejust ref. 16233
WatchesJul 16, 2025
The Top-Selling Rolex Models of the Last 15 Years, According to Bob’s Watches

The reseller’s market trends report, based on its sales data, also shows exactly how much Rolex prices have jumped since 2010.

Jean Dinh Van Orgue Ring
AuctionsJul 16, 2025
Christie’s To Honor Dinh Van With Exhibition

The auction house will be hosting a retrospective paying tribute to jeweler Jean Dinh Van and his company’s 60th anniversary.

Jake Duneier and Danielle Duneier
IndependentsJul 16, 2025
Clyde Duneier Ushers In Fourth Generation

Jake Duneier and Danielle Duneier-Goldberg have stepped into the roles of CEO and president, respectively.

Boucheron Impermanence Boucheron Dragonfly Earrings and Wisteria Hair Piece
CollectionsJul 15, 2025
Boucheron’s New High Jewelry Calls Attention to Nature’s Impermanence

The “Impermanence” collection contemplates nature through the Japanese art of Ikebana (flower arranging) and philosophy of wabi-sabi.

James Avery Cedar Park
MajorsJul 15, 2025
James Avery Expands to 2 More States

The Texas-based jewelry retailer has set up shop in Tennessee and Arizona.

×

This site uses cookies to give you the best online experience. By continuing to use & browse this site, we assume you agree to our Privacy Policy