Titan's jewellery division crossed the recovery phase to growth phase in Q3FY21
Titan Company on Wednesday released its quarterly update for Q3 of FY 2020-21 and said that company was expecting a good festive season and the third quarter did not disappoint them.
Titan Company on Wednesday released its quarterly update for Q3 of FY 2020-21 and said that company was expecting a good festive season and the third quarter did not disappoint them. In the third quarter ended December 31, 2020, the jewellery division has crossed the recovery phase to the growth phase and the other two large divisions have also moved much closer to the full recovery.
The Company created an 'International Business Division' last year to bring focus on further exploring and exploiting the opportunities outside India in a calibrated manner. 'Tanishq' opened its first boutique in Dubai during the quarter, which is also its first store outside India and has got an excellent response from non-resident Indians and other residents in the UAE.
The Company's 'War on Waste' program is proceeding very well and the focus on cash generation continues to yield good results.
Besides, Titan Commodity Trading Limited (TCTL) has also received the approval of the admission of Membership as a Trading Member (Stock Broker) on Multi Commodity Exchange of India Ltd. (MCX) along with SEBI approval for the same. The company is setting up its processes and is expected to commence its activities very soon.
Titan said that the jewellery industry saw a resurgence in the festive season along with a pent up demand for wedding jewellery as most of the weddings in H1FY21 were deferred.
The Company already announced the 15 per cent growth in the 30-day festive period from Dussera to Diwali. Fortunately, the growth trend was visible even after the festive season ended and the division has recorded close to 15 per cent growth (excluding the sale of raw gold of Rs 334 crore) in Q3.
The quarter also witnessed a well-rounded recovery with improvement in walk-ins and pick up of sale in metros, sub-1-lakh category and studded segment. The studded mix in Q3 improved though still lower than levels seen in the previous year. The division continued to see a significantly higher share of gold coin sales and very good growth in wedding jewellery sales.
Ticket size continues to be higher due to higher gold rates and a higher share of wedding-related products but 100 per cent recovery in buyers (number of invoices) is yet to be seen. The division is promoting "Rivaah Aashirwaad", through in-store promotions and on Tanishq's website, as a campaign for wedding jewellery for brides of different communities. 'Ekatvam' collection, a confluence of various art forms from around the country, was launched to express and celebrate the thought of "Oneness", a key essence of humanity, particularly in these challenging times. In high-value studded, 'Moods of the Earth' collection was launched, for fashion-forward women who love to appreciate the beauty of nature around her.
Titan's Watches & Wearables division had a recovery rate of around 88 per cent in Q3, compared to the revenue of the same quarter in last year. The E-commerce channel is leading the recovery with very strong absolute growth of over 30 per cent.
The festive period saw a surge in footfall in the shopping zones and the recovery rate improved in metros in Q3. The recovery rate for all the retail channels had been steadily increasing month on month primarily due to higher consumers walk-ins and also complemented by the selling of multiple products/ higher ticket size product in a single invoice.
Titan's Eye Wear division had a recovery of 92 per cent in Q3, compared to the revenue of the same quarter in last year. 'Eco lite' stores requiring lower investment and improving the profitability of the franchisees were introduced during the quarter. 'Titan Crest', a lndiFit collection crafted for Indian faces, which is made-in-India and made-for-India was launched. 'Titan Ace - Limitless collection' of rimless frames was another offering by the division.
The company's other businesses had a revenue recovery of around 80 per cent, compared to the revenue of the same quarter last year. 'Taneira' opened another store in Mumbai during the quarter gone by, taking the total store count for the business to fourteen covering six cities. The brand launched EIRA collection i.e. a range of stitched kurta sets in Q3FY21. The recovery rate for Fragrances and accessories continued to be muted due to the slow recovery of two of the biggest channels, trade and LFS.
Talking about its subsidiaries, Titan said, Titan Engineering and Automation Limited (TEAL) - 100 per cent owned - had a decline of -31 per cent in Q3, with one large order currently in transit. The Automation Business has been doing well, on the back of Medical Devices order for detecting TB and Covid-19. The Aerospace Business continues to face headwinds due to the grounding of flights due to Covid-19. The Division's focus on costs and capital employed is yielding results.
Caratlane - 72.3 per cent - owned delivered a growth of 39 per cent for the quarter and the growth turned positive on a cumulative basis for the year. This growth was driven by a strong Diwali plan and pick-up in consumer sentiment during the season.
The company says that it continues to focus on the creation of a combined digital and physical experience by which the customers can discover, engage, and buy products of their choice through the channel of their preference.
Brand websites of Tanishq and Titan Eye Plus have added augmented reality for virtual try-out of certain products by customers. The well-being of its store staff and customers continue to be the top priority and the Company is relentlessly maintaining its high safety standards keeping its promise of providing the safest stores in the town.