Company Update : Titan Company Ltd By Motilal Oswal Financial Services
Reports double-digit sales growth
TTAN released its pre-quarterly update for 2QFY25. Here are the key highlights: TTAN added 75 stores during the quarter, and its total retail presence (including CaratLane) stood at 3,171 stores at the end of 2QFY25.
Jewelry division
* Standalone jewelry sales grew 26% YoY (ex-bullion) in 2QFY25 (vs. our estimates of 20% in 2QFY25 and 9% in 1QFY25 / 19% in 2QFY24).
* Consumer demand significantly picked up momentum after the reduction in custom duty on gold imports from 15% to 6%, leading to a strong double-digit uptick in gold (plain) for the quarter.
* The jewelry segment’s domestic operations grew ~25% YoY. The LFL (secondary) sales growth for domestic operations came in the mid-teens (vs. our estimate of 14% for 2QFY25 and 3% in 1QFY25).
* The non-solitaire studded segment recorded growth in high double-digits.
* The solitaire segment saw a decline amidst price uncertainty and demand supply dynamics in the international markets, both together resulting in overall studded sales growth in low double-digits for the quarter.
* Buyer growth was ~11% YoY, driven by the launch of new collections, promotions, and marketing campaigns.
* The company added 24 stores in the jewelry segment. Mia added a new store in Abu Dhabi during the quarter.
* Domestic store additions were 23: 11 stores in Tanishq, 11 stores in Mia by Tanishq, and one store in Zoya.
Watches & Wearables division
* The watches and wearable segment’s domestic business grew 19% YoY.
* Analog segment revenue grew by ~25% YoY, supported by both volume and value increases. Premiumization trend continued to drive growth across brands.
* The wearables segment experienced a low double-digit decline in revenue as the category continued to face a significant downturn.
* Store additions: 34 new stores (18 of Titan World, 14 of Helios, and two of Fastrack).
Eyecare division
* The division’s domestic business grew 6% YoY. The secondary sales growth was nearly similar, with buyers growing marginally YoY.
* Titan Eye+ added two stores during the quarter.
Emerging businesses (Fragrances & Fashion Accessories and Indian Dress Wear)
* Taneira's sales grew 11% YoY. It opened four new stores, with two of them in the new cities of Indore and Prayagraj.
* F&FA revenue grew 17% YoY. Within the business, Fragrances grew ~19% YoY and Fashion Accessories rose ~11% YoY.
CaratLane
* The business grew ~28% YoY in 2QFY25, aided by activations and healthy growth in brand searches.
* Buyers grew ~24% YoY, and the LFL (secondary) growth was ~21% YoY.
* Studded ratio was higher compared to 2QFY24.
* It added 11 new domestic stores during the quarter, taking the total count to 286.
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