Titan reports 16% rise in Q2 net to Rs 148 cr

Bangalore-based Titan Industries Ltd, the watch to jewellery and precision engineering products maker from the Tata Group, on Friday reported a net profit of Rs 148.20 crore for the second quarter-ended September 2011 compared to the corresponding quarter last fiscal, showing a growth of 16 per cent.

The overall income in the second quarter, July to September 2011, was Rs 2,124.58 crore, a growth of 37 per cent over the corresponding quarter’s income of Rs 1,551.22 crore during the same period.

All business units of the company have recorded a good performance compared to last year due to the good retail sales growth. However, the watch business was affected by input cost increases and adverse currency fluctuations, leading to pressures on its margins.

The income from watches was Rs 417.41 crore in Q2 compared to Rs 359.43 crore last year, a growth of 16.1 per cent. On the other hand, jewellery business recorded an income growth of 44.7 per cent during Q2 over last year. It had an income of Rs 1,631.23 crore this year in Q2 as compared to Rs 1,127.36 crore last year.

Other businesses of the company comprising precision engineering, a B2B business, the eyewear business and accessories grew 16.3 per cent in Q2. The combined income of these businesses was Rs 65.17 crore in Q2. Their last year income for Q2 was Rs 56.03 crore.

Titan Industries has a retail chain of 737 stores as of September 2011 with a retail area crossing 920,000 sq ft nationally for all its brands.

Bhaskar Bhat, managing director of the company, said: “The second quarter has been a healthy quarter for us recording an income growth of 37 per cent despite a slowdown being witnessed by the economy. This performance was driven by a good retail growth for most of our brands and various initiatives undertaken by all businesses to introduce exciting products and enhance customer satisfaction.”

During the second quarter, considered as an ‘off-season’ quarter, demand had to be stimulated through investment in advertising and in consumer offers. This strategy has helped keep retail sales growing — such an investment is likely to continue through Q3, he added.