Gemfields PLC (LON:GEM) achieved a new record at its auction of rough emeralds in Jaipur, India last week.
It netted US$5.15 per carat, a new high for lower quality stones, as it raked in a total of US$14.3mln from the sale.
Of the 3.67mln carats offered, 2.78mln, or 76%, were sold, Gemfields told investors.
Jaipur was the fourth auction this year of output from the company’s flagship Kagem mine in Zambia. Since 2009 there have been 22, raising US$426mln in revenue.
The next big sale – this time of mixed quality rough rubies from the Montepuez operation in Mozambique - takes place in Singapore next month.
Chief executive Ian Harebottle told investors: "Jaipur has delivered another solid auction result, including a new record price per carat for our lower quality emerald auctions.
“The results from this auction mean that the Kagem mine has exceeded US$100mln of declared revenues for the current financial year.
“And, while we are confident that these numbers will be well surpassed in the years to come, we remain grateful for the part that each of our loyal staff members have played in ensuring that Kagem is the first mine to reach anywhere near this milestone in the history of the Zambian gemstone sector.”
House broker FinnCap repeated a target price for the shares of 85p (current price: 43p).
"The auction resulted in a new record high of US$5.15 per carat, although volume sold at 2.78 million carats was lower than expected," it said.
"This was in part because the lowest quality beryl is no longer sold by auction, but also because of some uncertainty about final recovery meant that some lots did not reach their reserve prices."
Panmure Gordon repeated a 'buy' stance and a target of 57p.
"We continue to believe Gemfields offers an unrivalled proposition for investors, providing exposure to precious stone consumption growth through two world class mining operations, Kagem and Montepuez, as well as exposure to the luxury goods segment via the Company’s Fabergé brand.
"The company also offers additional opportunities for growth through additional production sources in Zambia, Colombia and Ethiopia. Following the general underperformance vs. the sector we believe a re-rating is highly likely given the numerous catalysts in the coming months," said analyst Kieron Hodgson.