Hit by higher gold prices, leading consumer goods company Titan on Tuesday reported a marginal 1.83 per cent year-on-year rise in standalone profit at Rs 320.16 crore for the September quarter. The company had posted Rs 314.38 crore profit in the year-ago period.
Analysts on average had estimated double-digit growth in PAT for the jewellery to watches brand in the second quarter. Total income from operations in the second quarter was Rs 4,435 crore, against last year’s income of Rs 4,407 crore during the same period.
CK Venkataraman, managing director of Titan said, The company has done well across all its businesses in the second quarter given the subdued market and consumer sentiments. The jewellery business has done better than most players in the industry.”
According to the company, after a sudden surge in gold prices in mid-June, there was a considerable decline in sales in July.
Higher level of promotion and schemes, led to strong growth in the months of August and September, it added.
The segment reported revenue of Rs 3,528 crore in Q2 of FY20 against Rs 3,582 crore revenue in the same quarter last fiscal.
At present, the company, which claims to be largest jewellery retailer in the country, owns four jewellery brands – Tanishq, Zoya, Mia and Caratlane. Its watch business recorded revenue of Rs 719 crore, up 6.4 per cent over Rs 676 crore in the year-ago period.
“The trend of multi-brand outlets (MBO) growing at a much faster clip compared to exclusive brand outlets continued. E-commerce sales also witnessed exceptionally strong growth during the quarter. EBIT margin was very healthy at 15.8 per cent despite the moderation in growth,” Titan said.
The eyewear business grew as well, by 28.5 per cent in the quarter, recording an income of Rs 154 crore as against Rs 120 crore last year. Other segments comprising accessories, fragrances and Indian dress wear grew by 33.2 per cent, recording a revenue of Rs 44 crore. The previous year revenue for this segment was Rs 33 crore.
Venkataraman said, “Both the watches as well as eyewear business have recorded good growth. For the second half of FY20 we are gearing up on all fronts to stimulate demand with innovative campaigns for new exclusive collections that are lined up for launch across all our brands.”
The company’s retail chain stands at 1,668 stores, as on September 30, 2019 with a retail area crossing 2.1 million sq ft nationally for all its brands.