Quarterly Update – Q4 FY2023-24
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Titan Company Limited Financial Overview FY 2024
- Annual Financial Performance (Standalone)
- Total Income: Increased from ₹36,361 crores in FY23 to ₹43,684 crores in FY24, marking a 20.1% growth.
- Earnings Before Interest & Tax (EBIT): Rose by 8.1% from ₹4,705 crores in FY23 to ₹5,087 crores in FY24.
- Profit Before Tax (PBT): Grew by 3.2% to ₹4,607 crores.
- Profit After Tax (PAT): Increased by 6.3% to ₹3,543 crores.
- Quarterly Financial Performance (Standalone)
- Total Income for Q4: Grew by 17.4% YoY, from ₹8,753 crores in Q4 FY23 to ₹10,280 crores in Q4 FY24.
- EBIT for Q4: Increased by 8.2% YoY to ₹1,139 crores.
- PBT for Q4: Nearly unchanged at ₹977 crores.
- PAT for Q4: Increased by 7.1% YoY to ₹786 crores.
- Business Segment Performance
- Jewellery: Dominated the revenue with ₹38,353 crores in FY24, up by 20% YoY. The Q4 revenue for this segment was ₹8,998 crores.
- Watches & Wearables: FY24 revenue was ₹3,904 crores, up by 18% YoY. The Q4 revenue for this segment stood at ₹940 crores.
- Eyecare: Grew slightly with FY24 revenue at ₹724 crores and Q4 revenue at ₹166 crores.
- International Operations and New Initiatives
- Expanded international presence with new stores in Dubai and Chicago.
- Launched the ‘Ceramic Fusion Automatics’ and ‘Classique Slim Multifunction’ collections.
- Introduced ‘Affordable Fashion’ product line under Titan Eye+.
- Key Campaigns and Sponsorships
- The ‘Festival of Diamonds’ campaign by Tanishq.
- Mia launched ‘SarangHearts’, a collection inspired by K-pop and K-drama.
- Sponsored the victorious women’s team in IPL 2024.
- Outlook for FY25
- Focused on continuing innovation and meeting the evolving needs of lifestyle consumers.
- The Managing Director noted FY24 as a satisfying year, especially highlighting the growth in Jewellery and Wearables segments.
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Titan Q1 FY25 Analysis: Key takeaways!!
Titan Company Limited faced multiple external challenges in Q1 FY25, including rising gold prices, fewer wedding dates across India, a superheated summer, and distractions due to elections. Despite these headwinds, the company managed to achieve 9% overall growth and 3% same-store growth in its jewellery business. The management expressed satisfaction with the performance of different businesses relative to industry conditions.
Strategic Initiatives:
- Focus on expanding Mia and CaratLane brands to capture the younger, modern audience segment.
- Continued investment in store expansions and transformations, with plans to open 40-50 Tanishq stores, 70-80 Mia stores, and a similar number of CaratLane stores.
- Emphasis on product innovation and premiumization in the Fastrack brand to drive growth.
- Ongoing efforts to improve the product lineup and fashion-forward offerings across brands.
Trends and Themes:
- Increasing competition in the organized jewellery sector.
- Growing importance of the younger, modern audience segment in the jewellery market.
- Shift towards premium products in the watch segment, particularly for the Fastrack brand.
- Continued focus on expanding presence in smaller towns and cities.
Industry Tailwinds:
- Ongoing formalization of the jewellery industry.
- Growing demand for branded jewellery among younger consumers.
- Expansion opportunities in smaller towns and cities.
- Recent reduction in customs duty on gold, potentially stimulating demand.
Industry Headwinds:
- Volatility in gold prices affecting consumer sentiment.
- Fewer wedding dates impacting wedding-related jewellery purchases.
- Intense competition in the organized jewellery sector.
- Macroeconomic factors and geopolitical uncertainties affecting gold prices.
Analyst Concerns and Management Response:
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Concern: Competitive pressure from other organized players.
Response: Management acknowledges increased competition but believes they have maintained overall market share. They are focusing on product innovation, store expansions, and customer experience to stay ahead. -
Concern: Impact of custom duty reduction on margins.
Response: Management expects a maximum impact of ₹500-550 crores over the next 6 months but believes it will benefit the organized sector by creating a level playing field. -
Concern: Subdued performance in high-value studded jewellery.
Response: The company has infused new collections and inventory in the ₹5 lakh+ segment and expects an uptick in this category.
Competitive Landscape:
The jewellery industry is seeing increased competition from both regional players expanding nationally and new entrants. Titan acknowledges the challenge and is focusing on maintaining its competitive edge through product innovation, store expansions, and leveraging its strong brand equity.
Guidance and Outlook:
No specific numerical guidance was provided, but the management expressed confidence in their ability to navigate challenges and capitalize on growth opportunities. They expect the recent customs duty reduction to stimulate demand in the short term.
Capital Allocation Strategy:
The company continues to invest in store expansions and transformations across its brands. They are also focusing on product development and innovation to drive growth.
Opportunities & Risks:
Opportunities:
- Expansion in smaller towns and cities.
- Growing demand for branded jewellery among younger consumers.
- Potential for market share gains due to industry formalization.
Risks:
- Increasing competition in the organized jewellery sector.
- Volatility in gold prices affecting consumer sentiment.
- Macroeconomic uncertainties impacting discretionary spending.
Regulatory Environment:
The recent reduction in customs duty on gold is expected to benefit the organized sector by creating a more level playing field. However, potential changes in GST rates for jewellery remain a concern.
Customer Sentiment:
Customer sentiment has been affected by high gold prices and macroeconomic factors. However, the company has observed an uptick in demand following the customs duty reduction.
Top 3 Takeaways:
- Titan is navigating a challenging environment with strategic initiatives focused on store expansions, product innovation, and capturing the younger consumer segment.
- The company is facing increased competition but believes it has maintained its overall market share.
- Recent customs duty reduction is expected to stimulate demand in the short term, but the company remains cautious about potential headwinds.
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For anyone who is tracking this company for a long time…Was Titan in SME Segment before it became a Small Cap-Mid-Large Cap
Both Titan and Kalyan have shared their business updates. I have compared Tanishq Jewellery(Tanishq, Mia and Caratlane) with Kalyan(Kalyan, Candere)
Tanishq & Kalyan: Q2FY25 Business Highlights 
Tanishq Jewellery (Titan Company Limited) and Kalyan Jewellers both reported strong Q2FY25 results. Let’s examine their performance, focusing on revenue growth and expansion strategies.
Revenue Growth Sparkles 
Both companies thrived in Q2FY25, capitalizing on increased consumer spending after India reduced the custom duty on gold imports. Here’s a closer look:
| Metric | Tanishq Jewellery (Titan) | Kalyan Jewellers | |
|---|---|---|---|
| Consolidated Revenue Growth (YoY) | 26% | 37% | |
| India Jewellery Revenue Growth (YoY) | 25% | 39% | |
| SSSG | Mid Teens | 23% |
- Kalyan Jewellers achieved higher overall revenue and same-store-sales growth than Tanishq Jewellery.
- The reduction in gold import duty significantly boosted demand for both companies, highlighting the sensitivity of the jewellery market to gold pricing.
Expanding their Footprint 
Both companies strategically expanded their store networks in Q2FY25, primarily in India:
| Detail | Tanishq Jewellery (Titan) | Kalyan Jewellers |
|---|---|---|
| Total New Stores (Jewellery, net) | 34 | 27 |
| Breakdown | 11 Tanishq, 11 Mia (India), 1 Mia (Abu Dhabi), 11 CaratLane | 15 Kalyan, 12 Candere |
| Strategy | Multi-brand approach targeting diverse demographics and price points. | Focus on the Kalyan brand with a growing franchise-owned-company-operated (“FOCO”) model. |
| Total Stores (as of Sept 2024) | 1,009 (723 Tanishq & Mia, 286 CaratLane) | 303 (231 Kalyan India, 36 Kalyan Middle East, 36 Candere) |
- Titan’s multi-brand strategy allows them to capture a wider customer base.
- Kalyan’s FOCO model could enable faster expansion with potentially lower capital investment.
Digital Dominance 
Both companies experienced considerable growth in their digital first platforms:
- CaratLane (Titan): Recorded c. 28% YoY growth.
- Candere (Kalyan): Achieved approximately 30% YoY growth.
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Conclusion:
This quarter has been good for both the companies. With festive season coming Q3 is generally best quarter for jewellery market.
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I have a question regarding Lab Grown Diamonds.(LGD)
Trent Ltd ( a Tata Group Company) has launched LDGs under brand name Pome
Mr. N N Tata and Mr. Bhaskar Bhat are both on the board of Titan and Trent.
Isn’t this a conflict of interest for the Titan company ?
Mgt. of Titan has been observing LGD market in India as alluded by them in last three concall many times.
Titan is market leader and has expertise in jewellery , shouldn’t the brand be launched by Titan ?
Unable to wrap my head around this.
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CSR activity by Titan eye plus…
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I was recently doing the fundamental analysis of Titan Ltd. I was going through the Inventory part.
To me i found out that the company was able to do 3x the sales consistent for the last 10 years.
Is it a good thing that the sales has been consistent or the sales should be increasing with the time being.
Post Covid the comapany has increased the inventory growth to a significant level, but can anyone explain why the turnover ratio is same.
Is the situation same with other peers also ?
Thank you
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Titan Engineering is walking the talk of getting into aerospace, semicon and electronics from initial automation. Amazed by capabilities and clientele they have.
They have scaled from 500 cr to 900 cr in just two years. So ambition of 5000cr looks very much doable.
If this was an independent entity, it would command a mcap of not less than 10,000 crore.
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