Latest news with #TitanCo.Ltd
Mint
09-05-2025
- Business
- Mint
What higher gold prices have meant for Titan's Q4 performance
Gold prices are flirting with the ₹100,000 per 10gm mark, making many Indian consumers rethink their jewellery purchases, a trend that could impact retailers like Titan Co. Ltd. In its March quarter (Q4FY25) earnings call, the management noted that consumer sentiment has been particularly affected in the sub- ₹50,000 price band, especially for gold items, with some impact seen in studded jewellery as well. One reason is that as gold prices rise, some products previously priced under ₹50,000 shift to a higher bracket. Against this backdrop, the company expects 'more and more customers to be open to lower caratage, simply because the price point has become quite a bit." In the higher price bands, some consumers are adjusting by opting for simpler products. In other words, while they're still purchasing gold at a set value, they're opting for items with lower making charges. Overall, consumers still want gold, but within their budgets; and are looking for solutions such as lightweight or lower-carat jewellery, along with possibly lower making charges, Titan said. Read this | Titan faces pressure in solitaire Rising gold prices in Q4FY25 and FY25 have continued to impact Titan's overall product mix, resulting in about 300 basis points (bps) lower studded jewellery share for the quarter and about 190bps lower share for the year. Elevated gold prices and consumer preferences last quarter meant higher coin growth, impacting the product mix and margins. Still, Titan's margin performance in Q4 was encouraging, aided by relatively better overheads management and strong revenue growth. The company's jewellery Ebit (earnings before interest and tax) margin contracted just 25 basis points year-on-year to 11.9% last quarter. Q4 jewellery Ebit growth was 22% to ₹1,331 crore. 'Despite rise in gold price and heightened competitive intensity, Titan is showing early signs of margin stability," said analysts from ICICI Securities Ltd in a report dated 9 May, adding, 'In our view, jewellery margin has bottomed out and should see gradual improvement going ahead." Titan's standalone Q4 jewellery revenue, excluding bullion sales, were up 25% year-on-year at ₹11,232 crore, underpinned by about 27% growth in plain gold jewellery and about 64% rise in gold coins. The growth in gold jewellery segment was primarily driven by ticket size growth, while both studded and gold coin segments saw rising buyer numbers. Read this | As gold prices hit record high, Tanishq rethinks wedding jewellery strategy Titan's second key business, watches and wearables, performed well, posting a 20% revenue growth to ₹1,126 crore. This was driven by an 18% increase in domestic analogue watches and robust double-digit growth in the Helios channel, which features premium Titan and international brands. As a result, the watch Ebit margin expanded by 330 bps to 11.8%. Overall, Titan's standalone Q4 operating revenue and Ebitda grew 20% and 30%, respectively, reaching ₹13,477 crore and ₹1,438 crore. The market responded positively to these results, driving Titan's stock up by around 4% on Friday, even as the Nifty 50 fell 1%. Looking ahead, Titan targets double-digit revenue growth in FY26, though sustained high gold prices could pose short-term challenges. 'We cut our FY26 earnings per share (EPS) estimates by about 1% due to higher interest and depreciation expense, while we increase FY27 EPS estimates by about 2% led by improved Ebitda margin and expected reduction in interest expenses on lower debt and GML (gold metal loan) rate normalization," said analysts from JM Financial Institutional Securities Ltd. Also read | Mint Primer: Will gold soon touch ₹1 lakh/10gm? The broking firm has increased its price-to-earnings multiple from 55x (earlier) to 57x led by stability in margins; and 15%, 27% and 33% compound annual growth rate in revenue, Ebitda and net profit over FY25-27. JM's target price is ₹3,725 apiece, while the stock now trades at about ₹3,505. Investors should bear in mind that consistently elevated or rising gold prices may dampen volume-led gains in the near-to-medium term, particularly if competition remains high.
Mint
08-05-2025
- Business
- Mint
Titan names Ajoy Chawla as next MD
New Delhi: Jewellery and watch retailer Titan Co. Ltd on Thursday announced a leadership change, naming Ajoy Chawla as its next managing director. Chawla, who currently heads Titan's jewellery division, will take over from C.K. Venkataraman, who is set to retire on 31 December 2025 upon reaching the Tata Group's superannuation age. Chawla's appointment is effective from 1 January 2026. Chawla's ascension marks a strategic shift as he takes the reins after a period of significant growth in the jewellery segment, where sales and profits have more than doubled under his leadership since October 2019. The decision also comes as Titan reported strong financials for FY25, with total income up 22% to ₹ 57,819 crore. In the March quarter, consolidated income grew 22% to Rs14,049 crore. Profit for the period grew 13% to ₹ 871 crore. A Titan veteran, Chawla joined the company in 1991 and has held key roles across the watches, accessories, and jewellery segments. Before leading the jewellery division, he served as chief strategy officer and spearheaded the launch of the fragrances business (SKINN) and the ethnic wear brand, Taneira. While the formal process for inducting Chawla onto the board and confirming his MD appointment is pending shareholder approval, the company said the decision regarding his successor in the jewellery division will be announced later. "On behalf of the entire Titan team, I welcome Ajoy to lead Titan in its next phase of innovation and growth. With his strong customer obsession, people orientation, partnering impulse and focus on creating value, Ajoy is well qualified to shepherd Titan towards even greater glory and scale," said Venkataraman. Founded in 1987 as Titan Watches Ltd, Titan is a joint venture between the Tata Group and the Tamil Nadu Industrial Development Corp. (TIDCO). Its portfolio includes jewellery (Tanishq), watches, eyewear, ethnic wear, and accessories. 'While FY25 was marked by multiple external events that had varying impacts on the businesses in general, Titan's businesses clocked yet another year of strong 22% revenue growth resulting in the company crossing the impressive milestone of ₹ 50,000 crore of revenues for the full year," Venkataraman said. "Our analogue watch business continued its strong growth trajectory by product innovation led premiumization whilst moving in sync with the rising aspirations of the Indian consumer. The eye care business has returned to the double-digit growth trajectory in Q3 and Q4 of FY25 and is poised for even better growth in FY26," he said. For the full year, the jewellery division's income rose 21% to ₹ 46,571 crore. Venkataraman added that all business segments are now focused on expanding market share in FY26.
