Titan on Wednesday reported a 37.8 per cent fall in consolidated net profit at 199 crore for the quarter ended September as compared to Rs 320 crore a year ago.
Sales were in line with expectations reporting an 89 per cent rise backed by sharp recovery in jewellery division sales after being hit by Covid-19 lockdown disruptions.
The company’s consolidated revenue saw a muted drop of 2.6 per cent to Rs 4,318 crore, from Rs 4,435 crore a year ago.
The recovery rate of revenue improved in the quarter, with the rate being 98 per cent for the Jewellery division, 55 per cent for the Watches and Wearables division, and 61 per cent for the Eyewear division. The jewellery division recorded an income of Rs 3,983 crore for the quarter as compared to Rs 3,650 crore last year, a decline of 9 per cent. The watches and wearables business recorded an income of Rs 401 crore against Rs 720 crore in the previous year, a decline of 44 per cent. The Eyewear business recorded an income of Rs 94 crore as against Rs 154 crore last year.
“While the customer sentiment improved substantially in the quarter, there was greater willingness to spend on plain gold jewellery and gold coins rather than pure discretionary items, explaining the reason why the recovery rates in Watches and Eyewear and even studded jewellery within the Jewellery division were lower,” said the company.
In jewellery, wedding sales contribution has been good for the quarter with the company seeing a marginal growth as compared to last year for the segment. “People are buying for the expected weddings in Q3 and Q4. We are betting big on weddings in the second half and not holding back on any inventory or promotion for the segment,” said Ajoy Chawla, CEO of Jewellery Division at Titan Company Ltd.
“In terms of festive sales, the first 11 days have seen a high single digit sales growth on a like-to-like basis as compared to last year but we need to see how consumers respond to the higher gold prices going forward,” said Abneesh Roy, Executive Vice President at Edelweiss Financial Services.
The company's watches division is expecting a full recovery by the end of Q4. “Business should recover to 100 per cent of last year level by the end of Q4,” said Suparna Mitra, CEO of watches and wearables division at Titan.