Gem Diamonds PLC (LON:GEM) has pulled out its biggest diamond yet from the Letseng mine in Lesotho.
The 910 carat sparkler is thought to be the fifth largest diamond of gem quality ever recovered.
READ: Gem Diamonds announces discovery of two more notable diamonds from its Letšeng mine in Lesotho
Gem said it was an 'exceptional' D Colour Type IIa stone that highlighted the quality of Letseng as a source of super diamonds.
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Broker Liberum upgraded its view on Gem on the back of the discovery and also the potential for more massive diamonds to be unearthed in Letseng.
“The pricing of diamonds is hugely variable and driven by a multitude of factors, but assuming that there are no large inclusions running through the diamond, we initially estimate a sale of US$40mln," said the broker.
“The 1,109 carat Lesedi la Rona found in 2015 by Lucara at its Karowe mine sold for US$53mln eventually, implying a pricing of c.$48,000/carat.
“This would imply a $43m price tag for the Letseng diamond, but we place large caveats on this estimation, given that the pricing is rarely linear.“
Clifford Elphick, chief executive. said: "Since Gem Diamonds acquired Letšeng in 2006, the mine has produced some of the world's most remarkable diamonds, including the 603 carat Lesotho Promise, however, this exceptional top quality diamond is the largest to be mined to date and highlights the unsurpassed quality of the Letšeng mine.
"This is a landmark recovery for all of Gem Diamonds' stakeholders.
Shares in Gem Diamonds rose 8% to 87p compared to Liberum’s new price target of 115p.