Titan’s Q1 Net Profit Falls 1% to Rs 770 Crore Amid Rising Gold Prices

Titan Ltd, the noted jeweller and watchmaker, has posted a marginal drop in standalone net profit for the April-June quarter to Rs 770 crore from Rs 777 crore a year ago. The reduction was on account of lower demand following rising gold prices.

The revenue from operations of the Tata Group company for the fiscal's first quarter grew by 9 per cent to Rs 11,263 crore from Rs 10,306 crore in the same quarter a year ago.

According to CK Venkataraman, the Managing Director of Titan, this Union Budget spelled out more than a few sops. He added that the jewellery industry would, in due course, benefit from the long-term positive impact of the reduction in customs duty on gold imports from 15 percent to six percent. However, he mentioned that this may lead to a short-term loss in value for the duty-paid gold inventory, which he estimated would be absorbed in two quarters. He said the market would get more conducive for large businesses like Titan.

Venkataraman also highlighted mixed trends in consumer behaviour across lifestyle categories due to various factors. First was the adverse weather conditions, general elections coupled with fewer wedding days that dented retail traffic. But the performance in watches, wearables, eyeCare segments were quite strong.

Its jewellery division, which includes brands Tanishq and CaratLane and comprises 88% of the total revenue of the company, saw revenues grow by 10%. Watches and wearables, that contributed 8% to total revenues, posted a 12% rise.

Titan had reported a 7% rise in standalone net profit at Rs 786 crore during the same quarter last year and declared a dividend of Rs 11 per share.

Tanishq added two new locations in Dubai and Chicago in Q4 and increased its global jewellery footprint to 16 stores. In the domestic market, Tanishq added 11 new stores, while Mia added 16 new locations.

Titan's shares ended the day 0.5% lower at Rs 3,450 each on the BSE.