Buoyed by growth in the jewellery division, Titan Company on Wednesday posted an 11.8 per cent increase in consolidated net profit at Rs 530 crore for the third quarter ended FY21. The company had posted a net profit of Rs 474 crore in the corresponding period a year ago.
Consolidated revenue during the quarter stood at Rs 7,659 crore, up 16.9 per cent against a revenue of Rs 6,550 crore in the year-ago period, the company said in a BSE filing.
“Titan Company reported a return to yoy growth in sales in Q3 of FY21 led by an impressive festive season recovery in the jewellery division,” said the company.
While the jewellery business grew by 16 per cent (excluding gold bullion sales) over the corresponding quarter of the previous year, the watches and wearables and eyewear divisions also did well with the recovery rate for the quarter being 88 per cent and 93 per cent, respectively.
Riding on a strong festive and wedding season, the company saw significant recovery in the diamond studded segment of the jewellery business with coin sales continuing to remain high.
“We are pleased to see the return to growth in top line for the company and the recording of the highest ever profits in any quarter in the midst of the pandemic that has hit the world so hard. The recovery witnessed has been significantly better than what we had hoped just a few months back,” said C K Venkataraman, Managing Director of the watches-to-jewellery maker.
Because of absence of travel and substantial pruning down on wedding celebrations, jewellery purchases have seen a boost as the share of wallet has gone up for them, according to the Bengaluru-headquartered company. “Wedding growth was 10 per cent in Q3 for us and it was upwards in the range of 16 per cent in January. For the next 5-6 months we will be bullish on weddings,” said Ajoy Chawla, CEO of jewellery division at Titan, during an investor call on Wednesday.
The watches and wearables business recovered well in the quarter to record an income of Rs 551 crore against Rs 627 crore in the previous year, a decline of 12 per cent. The eyewear business also improved with revenues declining by 7 per cent in the quarter, recording an income of Rs 124 crore as against Rs 133 crore last year. “The eyewear business has taken much longer to deliver than it was expected to but as 2020 has been a transformational year for this segment and there has been a substation transformation in terms of channels, in the next 2-3 years it will be a rocking business,” said Venkataraman during the investor call.
The recovery in the other segments of the company comprising Indian dress wear and accessories was slow and these divisions recorded an income of Rs 123 crore compared to Rs 175 crore in the previous year, a decline of 29 per cent.
Consequent to the decision of the company to significantly scale down the operations outside India, it made a provision of Rs 137 crore relating to impairment of investments in Favre Leuba, a wholly-owned subsidiary.