Timex Group (TGIL) - time to take notice?

Stock Opportunities Untested - but worth a good look
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What is the floor price? The announcements say 175 Rs but none of the brokers are allowing below 206.05 Rs. Is the retail floor
price based on the non-retail bids?

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How to know OFS final price of retail investors,cutoff price increased in retail share holders, cutoff price OFS placed orders also not get the OFS,which price place orders and all not understood,cutoff price place the orders means not get the OFS,how to get the OFS for retail share holders ..,Thank you..

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There is a high probability that the market price will drop below the offer price, especially with continuous lower circuits. Therefore, it is better to wait and observe. I don’t understand why the promoter would sell the stake at such low levels, as most companies typically sell at a maximum discount of 5-10%. Given the current trend with OFS and QIP, many stocks typically touch or potentially drop below the OFS price in the near term.

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Times FY 2025 AGM notes

Chairman David Thomas Payne speech:

  • Revenues grew by 28% and profits by 54%.
  • Growth momentum attributed to focused strategy to expand timex group brads, offer more aspirational domestic and international brands, Engagement enhanced through compelling storytelling and dynamic marketing initiatives.
  • The trade channels comprising of distribution, dealers, showrooms was the largest contributor to revenue growth.
  • Growth was also supported by expanding the e-com channel, increasing luxury segments sales and tactical marketing.
  • Company is focused on analog watches as a core offering. Timex brand remains the primary focus and main revenue driver but anticipate significant growth at entry level from other brands like Helix and TMX.

MD Deepak Chabra Speech :

  • Revenue doubled over 3 yrs period and profits went up by 4 times and Market cap grew by 6 times in years. Gained market share in India from 13 to 19 % while industry is growing at 11%.
  • For FY 25 the large format stores which includes 42 of our retail stores in 2 formats Timex World( 22) and Just Watches(20) is the biggest sales channel contributing 50% of top line. This channel has grown by 26% last year.
  • Ecomm contributed around 32% , it was 7% 3 years back and has grown significantly. IT has grown 31% in the last year.
  • OEM business was at 16%, its largely with Aditya ( Allen solly , Peter England , Van huesen) where company makes watches for them from design to after sales is handled by Timex. EOM is done for other brands too like Woodlands. OEM business grew by 43% last year.
  • CSD and rest of the business is very small at 2% over all sales.
  • License portfolio consists of 15 brands and contributes 30% topline and has grown at 27% last year.
  • Smart watches is a smaller business at 4% and grew at 23% last year.
  • Ebidta 3 yrs back was 3% and now is at 9%.
  • Regional breakdown of sales: North and west at 32% each, south at 28% and east at 8%.
  • Sold 3.4 Million watches last year growth of about 14% at volume.
  • 28% growth of fy 25 was due to 14% growth on volumes and 14% growth on value (ASP) level.
  • Cater through 6000 POS, split as 5000 MBO , 400 Large format stores like shopper stop ,lifestyle etc. 500 CSD and 42 retail outlets.
  • Added 8 new airports as POS total now at 12 POS.
  • Launched justwatches.com , helix.com in addition to timex.com.
  • Average Selling price ( ASP ) : Versace 1.05 Lakh ranging between 80,000/- to 4 Lakhs INR. GUESS at 15,000/-. Timex at 3400/- which was at 1800/- 3 yrs back has seen the largest move. Timex is now stretching to 20,000/- INR at upper limit.
  • Fro 38 yrs company never paid any royalty to parent in USA. but starting from 2024 6% royalty for brands manufactured in India.
  • Launching Fria for Premium offerings for Women at 10,000/-
  • Brand recall : There are three things about brand and the marketing and the branding piece: awareness, relevance, and consideration. based on the survey by company which was done in 2023, awareness of Timex as a brand is amazingly high at 93%. relevance and consideration was low. Confusion about the association with Titan is prevalent.
  • Ananya Pandey is chosen for celebrity endorsement.
  • Capacity was at 3 million watches per year last year company produced 2.95 million hitting 95% utilisation. In jan 2025 Company invested in capex and now the capacity stand at 5.4 million watches per year.
  • Company plans to increase the store count to 300 stores across the 2 formats in next 2-3 years starting from jan 2026.
  • Company focus is on watches primarily , jewellery will be around 7% of sales in next 5 yrs. Guess watches are doing well so company would start with Guess jewellery in the jewellery segment. Company will be the first mover in this strategy as W&J concept is not prevalent in India.
  • GST on watches is at 18%, company is prepared to act on any changes on this rate.
  • Company gets all the brands which our parent company signs for any other part of the world at the same time.
  • 2 and half exciting announcements from MD :
  1. *Launching Aston Martin from October 2025 , global premium brand. License acquired at global level, Parent will launch globally and In India the Indian entity will Launch it.
  2. Signed up Bhumi Pednekar for Versace as brand ambassador , the ad campaign will start in September 2025.
  3. Title Sponsor for India Beach Fashion Week, which happens every year or in Goa
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Timex continues to report strong growth and benefit from strong operating leverage. Sharing my research on what is leading to this strong growth for the company-

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Good research & even better efforts to put this all through.
But doesn’t it seem a tad too old, we already being post Q2FY26 ?
Hope you would have gone through the necessary follow-through from recent results & concall, & updated the analysis, with management commentary & reading between their lines.

Would love to read the updated version, if any !

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Thanks for your feedback on research.

The way I look at it is that my thesis does not change with each quarter and thus you have an initial thesis (which is highlight in the initiation) and then quarterly updates on how things are moving in terms of the thesis.

In case of Timex, the subsequent quarters have only confirmed the original thesis and the thesis remains intact and stronger than ever.

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Promoter again sold ~9% of holding, taking the total promoter holding to ~51%,

How do you see it from your experience?

Is it because some big fishes wanted to have decent skin in the game, or promoters anticipate the stock is overvalued and see it as an opportunity, or anything else?

Here are a few pieces to the story -

  1. In late 2020, Baupost Group acquired a controlling stake in Timex’s global holding company
  2. Since there was an indirect change of ownership as per SEBI mandate, in Nov 2020, Baupost Group, along with its affiliates, rolled out an open offer for the acquisition of 25.07% of the shares of Timex Group India Limited from the public shareholder to offer them an exit.
  3. Open offer was made at a price of ~24 a piece but the share price during the tender period in March’21 was ~28 so I am assuming there was hardly anyone sold the shares in this period.

Pre-Offer Ad - Target Iintimation.pdf (5.9 MB)

TIMEX Offer for Acquisition (303.9 KB)

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Timex Group - Q3FY26 Results

Financial Highlights

  1. Revenue up YoY 26%, EBITDA up YoY 122%
  2. EBITDA margins improved to 6.8% vs 3.8% last year. Not comparable QoQ as Q3 is weakest each year.
  3. PBT (before exceptional items) up by 204% (expense of 3.2 crore on account of change in labour law)
  4. PAT up 65% YoY

9M Performance

Revenue growth of 40% driven by:

  • E-commerce growth ~70%
  • Traditional channel growth ~25%

Brand-wise growth (9M)

  • Timex: +52% (fastest growing brand)
  • Guess and Versace: +36%

Other key developments

  • Launched Atelier (I like the look btw) and various other models
  • Scaled capacity to 10 million watches annual through double-shift model (Q2 PPT mentioned annual capacity of 5-6 million in single shift)

One observable trend is, the company continues to shift sale touchpoints towards defense canteens, while pruning large format and retail. Which seems to be the reason for sharp increase in EBITDA margins (despite Q3 being weakest in terms of margins each FY).

Sales touchpoints (Q3 vs Q2):

  1. MBOs: 5025 vs 5025
  2. Large format: 372 vs 376
  3. Defense Canteen: 675 vs 595
  4. Retail: 41 vs 42
  5. Luxury Retail: 178 vs 151

Overall a good set of numbers.

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Timex Group India — 38th AGM Key Highlights (FY26)

  • 48% growth split roughly half value (26%) and half volume (22%)

  • Value contribution from both within-brand ASP increases and mix shift to higher-ASP brands (Guess)

  • Management says this 50:50 split has held for two-three years

Channel mix

  • E-commerce 40% of revenue, grew 90% (was 5% four years ago); four sub-channels — 1P buy-and-sell, 3P marketplace, own dot-coms, quick commerce

  • Trade 33%, grew 32%

  • OEM 15%, grew 43%

  • Others 12% — defence/CSD, institutional, LFS, exclusive retail

  • Quick commerce at 3% of total revenue, 8% of e-commerce; management insists it is category expansion (last-minute purchase occasion), not cannibalisation

  • Key claim: value-chain re-engineering two years ago means EBITDA delivery is similar across all channels, so channel choice is margin-neutral

Brand / business unit mix

  • Timex BU (Timex, Helix, TMX) 55%; licensed portfolio 30% (from 6-6.5% four years ago); OEM 15%

  • Current run rates: Timex Rs 500 Cr, Guess Rs 210 Cr, Versace Rs 100 Cr — top three at Rs 800 Cr combined run rate

  • Guess is now the second-largest fashion watch brand in India

  • Stated ambitions: Timex 500 → 2,000 Cr; Guess 210 → 400 Cr; Versace to double; TMX to Rs 150-300 Cr; Aston Martin to Rs 100 Cr; Helix back to Rs 100 Cr

  • Aston Martin: October launch, six-month buy sold through in two and a half months

Regional mix

  • North 35%, West 32%, South 25%, East 8%

  • South framed as a productivity problem (distribution in place, throughput low), not a coverage problem

Manufacturing and localisation

  • Baddi produced 38 lakh watches vs 29 lakh; capacity was 3 million at 99% utilisation

  • Capacity doubled to 6 million; target 1 crore single-shift installed by March 2027 — 3x in 18 months

  • Guess localisation planned: 300,000 units, Rs 210 Cr brand. Duty arbitrage 42% on CBU vs 10-11% on components; lead time compresses from 8 months to 45 days

  • OEM makes about 1 million watches p.a., margin comparable to overall business, payment in 7 days, no selling or A&P cost

  • Exports to affiliates currently 150,000 units; could reach 1.5 million if tariffs turn favourable. India positioned as “Cebu plus one” against the Philippines plant

Retail footprint

  • 6,000 POS: 5,100 MBOs, 300 LFS, 500 defence canteens, 41 EBOs; net addition of 110 doors during the year; present at 12 airports

  • EBO count flat at 41 (6 closed, 7 opened) — deliberate pause to build format, manning, and commercial model; LTL growth 30-35%

  • Expansion restarts January 2027: 200-250 stores over three years, targeting 250-300 EBOs by 2030

  • Model is FOFO only — explicitly no intent to become a retail operator

  • Benchmark cited: leader does 40-42% of revenue from 1,300 exclusive stores

Margin and cost commentary

  • Input headwinds: USD and CHF up 17%, movement prices up 30% (movements are 33% of component cost), gold Rs 90,000 → Rs 180,000/10g, silver Rs 110,000 → Rs 300,000/kg, copper and freight up

  • Despite this, gross margin rose 100 bps — attributed to selective price increases, cost discipline, overhead absorption from higher plant utilisation, and lower markdowns/thinner channel margins

  • Margin ceiling stated at 17.5-18%: management explicitly prioritises rupee gross margin and growth over percentage margin. Industry at 13%, leader at 30%

Working capital

  • Inventory Rs 150 Cr → Rs 200 Cr, framed as deliberate pre-season investment of free cash

  • Inventory turn 2.67x — described as best in 38 years

  • 99% of channel sales are outright with no contractual return/buyback; secondary at 95% of primary

Structural / demand thesis

  • Watch penetration only 16% of Indians; 40 million people p.a. entering the first-watch cohort; 400 million entry-level TAM

  • Metro per-capita ownership among owners at 4.3 watches, claimed highest globally (internal parent research)

  • Shift from functional device to fashion accessory drives multiple ownership; price-led to value-led

  • Rs 2,000-10,000 is the largest segment with only two players (Titan, Timex); TGIL at one-fourth the leader’s share

  • No new watch brand has established itself in India in 35 years since Titan

Entry segment (TMX) strategy

  • TMX plays Rs 700-1,500 for first-time buyers; acknowledged as low-percentage-margin but high absolute rupee margin

  • Deliberately deferred: focus stays on Timex for two-three years because mother brand strength must precede sub-brand scale-up; TMX becomes a primary growth driver around year three

  • Competition has not vacated the price point so much as moved sub-brands into it

Smartwatches

  • India volumes fell from 40 million (2023) to 22 million; no player made money

  • TGIL deliberately scaled down; currently sells 100,000+ units profitably

  • Ramp-up planned as market corrects, targeting 6-7% of revenue in three-four years; analog remains the core

Licensing risk

  • Guess held 40 years, Versace 25 years; licences flow from the parent globally. Marathon (India licence) renewed after five years

  • Management position: risk exists but has never materialised; minimum guarantees consistently exceeded

Capital allocation

  • No equity dividend; multiple shareholder requests deflected, with management endorsing the market-cap-creation argument instead

  • No rights or preferential issue planned; no subsidiaries

  • First year of CSR eligibility, budget Rs 81 lakh, partner not yet selected

  • Three celebrity endorsements (Timex, Guess, Versace) to be announced within three-four weeks

Parent commentary (David Payne)

  • India described as an extremely important strategic market and growth driver

  • Declined to disclose US or global revenue (privately held), and did not directly answer whether India can surpass the US business

Several analyst questions unanswered:

  • Just Watches economics — how revenue, inventory ownership and margin split between Timex Group US (which owns the brand) and TGIL

  • Import content percentage, PLI-linked localisation of movements/dials/cases, and gross margin sensitivity to 5% INR depreciation

  • Royalty plus support service charges of Rs 58 Cr and A&P of Rs 66 Cr — no response on the trajectory of these related-party-adjacent costs

  • Receivable and payable days trajectory; the working capital move from 100 to 150 days was addressed only on the inventory leg

  • Store-level economics (revenue per store), distributor incentive structure changes

  • OEM/ODM EBITDA contribution in absolute terms

  • Adjacencies (eyewear, handbags) and dedicated single-brand luxury outlets

.

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Hi @Satishwe , thank you for the detailed AGM notes. I first invested in TGIL in 2024 and continue to hold the stock.

I had a few questions:

  1. The management seems to be targeting growth from the current ~₹800 Cr revenue to ~₹3,000 Cr. Did they provide any timeline or milestones for achieving this target?
  2. Do you think this growth opportunity is strong enough to offset some of the concerns around management transparency, particularly their reluctance to address critical questions around royalty payments to Timex and other brands, as well as the questions surrounding Just Watches?
  3. Lastly, was there any meaningful update or additional detail on the jewellery segment and its growth plans?
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@saranshbagdi I had posted my notes from the agm as it happened. Since its been a month i dont remember much too. Please check the recording here https://www.youtube.com/watch?v=3j2YNwMgdzw

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What I can share based on my research and management commentry on your question:

  1. On the 800 Cr to 3,000 Cr ambition: We have seen several operational milestones, including Baddi’s planned expansion toward 15 million units, Guess localization, a new Swiss brand and the proposed 250–300-store Just Watches rollout over three years. However, I haven’t seen a specific timeline or a quantified revenue bridge to 3,000 Cr. Management also declined to provide FY27/FY28 revenue and PAT growth guidance, so I would treat 3,000 Cr as a long-term ambition rather than a time-bound forecast.

  2. On transparency: The growth opportunity is compelling, but I would separate business potential from disclosure quality. Management clarified that the royalty bucket includes Timex, TMX, Helix and locally manufactured OEM, and attributed the lower royalty growth partly to weaker OEM revenue. However, we still lack sufficient brand-level royalty economics, contract details and a complete explanation of the economics around Just Watches. Strong execution can support the investment thesis, but it shouldn’t be used to overlook unanswered questions.

  3. On jewellery: There was a limited update on the Guess jewellery trial. The discussed range was approximately 3,000–8,000, with distribution through online channels, selected Shoppers Stop stores and around 20 watch-store points. Management indicated that no significant revenue was expected from the trial at this stage. I would therefore treat jewellery as an adjacent optionality rather than a material contributor to the current valuation until we see evidence of sales traction, margins and a defined scale-up plan.

To conclude, these are still partial answers based on what management has communicated so far through the recent investor presentations and conference calls. We have some visibility into the company’s expansion plans, manufacturing capacity, brand strategy, and distribution initiatives, but we do not yet have sufficient clarity on the 3,000 Cr revenue timeline, the underlying economics of the royalty structure, or the expected returns from Just Watches. The jewellery initiative also remains at an early experimental stage.

Disclosure: Invested

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Thank you for the input and for sharing your perspective.

The lack of adequate disclosure has certainly been a concern for the street and, in my view, has deterred many investors.

The promoters have also come to the market with OFS twice. I initially thought this could potentially bring in some large, long-term institutional or strategic investors. However, nothing of that sort seems to have materialised—at least from what a common investor like me can observe.

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Agreed. The disclosure/OFS concerns are real, but I also wouldn’t want those concerns to make us overlook what has been a fairly significant operational transformation. They’ve now started doing private calls post-results, so hopefully we’ll get some more clarity after the upcoming results.

Honestly, it’s fun tracking companies like this. It almost feels like tracking an SME, half-yearly results, limited disclosures, and no investor calls most of the time, makes the research a lot more interesting.

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Definitely, I invested in the company after learning that Timex Group had been acquired by a PE firm and that Deepak Chhabra was appointed as MD. While this was not the only factor behind my investment decision, it was definitely an important one.

I intend to remain invested as long as the growth trajectory continues and there is no significant change in the underlying business or management quality.

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