Sarin

Sarin: MBKE maintains BUY with TP of $1.48. House notes the recent Hong Kong Jewellery Show ended on 9 March had much better business than a year ago and exceeding most expectations. This supports the cautiously positive outlook for luxury goods despite the uncertainties in the global economy. While there are no signs of increase in polished diamond prices yet, MBKE think that an improved demand may shift pricing power to the retailers. This should support Sarin in marketing its Sarine-Light. We think that the Sarine-light may take some time to take off but once endorsed by the industry, could form a strong recurring income source for Sarin. If Sarin’s Light Performance measurement is eventually accepted as the industry standard for measuring light performance characteristics, the potential revenue generated could be at least US$50m a year.