IGI closes FY26 transition year with 18 percent revenue growth and wider margins

International Gemological Institute Limited (IGI) ended the 15-month period to March 31, 2026 with steady volume momentum and strong profit translation, even as it shifted its reporting cycle to an April to March year. For the 15-month period (Jan 2025 to Mar 2026), consolidated revenue from operations rose to INR 15,976 Mn, up 18 percent year on year. The operating model stayed highly cash generative and margin rich. Group EBITDA increased 22 percent to INR 9,728 Mn, with EBITDA margin expanding to 61 percent, up 230 basis points. Group PAT grew 25 percent to INR 7,112 Mn, with PAT margin improving to 45 percent, up 269 basis points.

The March quarter (Jan to Mar 2026) reinforced the same pattern: growth driven by certification volumes and favorable segment mix. Consolidated certification volumes rose 16 percent year on year to 3.64 Mn reports. Certification revenue climbed 21 percent to INR 3,587 Mn and total revenues rose 23 percent to INR 3,868 Mn. EBITDA grew 21 percent to INR 2,360 Mn while PAT rose 28 percent to INR 1,796 Mn. The quarter also saw average realized price (ARP) per report rise 4 percent to INR 987, pointing to a healthier mix within certification demand.

At the end of March 2026, the company reported cash and cash equivalents of INR 8,005 Mn, reflecting 28 percent growth over the 15-month period. The balance sheet remained equity heavy with consolidated total equity of INR 14,880 Mn, and no borrowings reported in current liabilities.

Volumes stayed strong and LGD led the revenue mix

IGI’s financials continue to be anchored in one core engine: certification volumes. In the 15-month period, total reports increased 20 percent to 16.45 Mn. Certification revenues grew 19 percent to INR 15,465 Mn, slightly ahead of overall revenue from operations growth, indicating that the core certification business remained the primary driver.

The clearest growth signal came from lab grown diamonds (LGD). In the March quarter, LGD certification revenue rose 35 percent year on year to INR 2,155 Mn. LGD’s share of certification revenue increased from 53.8 percent to 60.1 percent in the quarter, a visible mix shift. LGD jewelry also grew 29 percent to INR 252 Mn and improved its share from 1.9 percent to 3.6 percent. Natural diamond (ND) loose stone certification revenue grew 10 percent to INR 534 Mn. The weak spot was ND jewelry certification revenue, which declined 19 percent to INR 517 Mn, taking its mix down from 21.4 percent to 14.4 percent.

Over the full 15-month period, the mix shift was similar but more gradual. LGD certification revenue rose 25 percent to INR 8,558 Mn, while ND rose 18 percent to INR 2,497 Mn. ND jewelry grew only 2 percent to INR 2,873 Mn, and its share slipped from 22 percent to 19 percent. LGD jewelry grew 23 percent to INR 1,149 Mn and maintained a 7 percent share.

There is one nuance in the 15-month data. Despite strong revenue and volume growth, ARP declined 1 percent to INR 940 from INR 952. This indicates that the product mix and pricing dynamics were different at the full-period level than in the March quarter, where ARP improved. Taken together, it suggests the mix improved late in the period, supporting pricing and profit conversion.

Margins expanded because costs grew slower than revenues

IGI’s economics are best understood by looking at expense growth relative to revenue. In the 15-month period, total revenues rose 19 percent, while total expenses increased only 11 percent. This gap widened operating leverage and lifted PBT margin to 61 percent from 57 percent. EBITDA margin moved up to 60.9 percent from 58.6 percent.

The March quarter also reflects high operating efficiency. Total revenues increased 23 percent year on year, while total expenses rose 22 percent. EBITDA margin stayed largely stable at 64.0 percent versus 64.2 percent. Yet PAT margin improved sharply to 48.7 percent from 46.2 percent, helped by the combination of higher operating scale and higher other income (INR 182 Mn in Jan to Mar 2026 versus INR 84 Mn in the prior year quarter).

On cash generation, the company highlights improving conversion from EBITDA to free cash flow (FCF). On a 12-month calendar year basis, FCF to EBITDA conversion improved from 50 percent in CY2023 to 59 percent in CY2024 and 60 percent in CY2025. The message is simple: profit quality remained strong, with cash conversion keeping pace as the business scaled.

The balance sheet also shows IGI’s investment phase. Consolidated non-current assets increased to INR 8,998 Mn from INR 4,850 Mn in CY2024, driven by higher goodwill (INR 1,531 Mn), higher other intangible assets (INR 776 Mn), and a rise in other non-current financial assets (INR 2,139 Mn). At the same time, consolidated total equity expanded to INR 14,880 Mn from INR 10,627 Mn.

Market context: certification intensity rises as LGD scales

IGI’s strategy narrative rests on a structural shift in diamonds toward higher transparency, traceability, and certification intensity. The investor presentation places this in the context of two parallel value pools: natural diamonds (ND) and lab grown diamonds (LGD). For ND, the demand argument is built around resilient bridal occasions across geographies, increasing ticket sizes with rising affluence, and growing omnichannel buying behavior. It also points to a long runway in India, where jewelry penetration is about 8 percent compared with about 70 percent in the US.

For LGD, the thesis is about scale and formalization. The presentation highlights planned capacity expansion and improving pricing stability in the last 18 months, which supports predictable retailer margins. It also notes that LGDs can offer 30 to 40 percent higher retailer margin than ND, making it an attractive category for gold and multi-category retailers.

The supply side for LGD is important because it links directly to IGI’s volume outlook. Global LGD production capacity has expanded sharply over time, reaching about 35 to 45 Mn carats by 2023 and 2024. In India, CVD reactor count is shown rising from about 6 to 6.5 thousand in 2022 to about 10 to 11 thousand in 2025, with 2026E at about 13 to 14 thousand. That planned increase implies a clear volume runway for grading and certification.

The company positions IGI as well placed to benefit because it is entrenched with key growers with in-factory grading set ups, and because LGD jewelry requires certification at the SKU level, which can increase certification density as retail formalizes.

What investors can take away from the transition-year numbers

Three themes stand out from the 15-month period ending March 2026.

First, growth is broad-based but led by LGD. Consolidated reports grew 20 percent and certification revenue rose 19 percent, with LGD loose stone growing 25 percent in the 15-month period and 35 percent in the March quarter. The quarter mix shift toward LGD and loose stone certification lifted ARP, and that is a useful indicator for near-term demand quality.

Second, operating leverage remains the core equity story. With expenses rising slower than revenues, EBITDA and PAT grew faster than top line. Margin expansion in the 15-month period is meaningful because it indicates that incremental volumes are being absorbed without proportional cost inflation.

Third, the LGD industry is entering a volume-scale phase, and that can structurally increase the need for certification. IGI’s own commentary links capacity scale-up, stable pricing, and retailer economics to rising certification intensity, especially in jewelry where SKU-level certification can expand report volumes.

The period was also a reporting transition, and the company provided additional comparatives to help investors. But the underlying signals are consistent. IGI is growing volumes, capturing LGD-led demand, and converting it into high margins and cash generation. The key question for investors is less about whether certification demand exists and more about how sustainably IGI can retain its operating leverage as industry volumes expand. The March quarter, with stable EBITDA margin and higher PAT margin, suggests execution is steady as the business scales.