Thread by @riteshdaga83

#Titan Ind

Titan Company Ltd is among India’s most respected lifestyle companies. It has established leadership positions in the Watches, Jewellery and Eyewear categories led by its trusted brands and differentiated customer experience.

TITAN business at Glance

Titan’s Jewellery Division – Q1FY23 Business Update

Titan's jewellery division revenue increased by 204% on YoY to Rs.7,995 cr on a high base of Q1FY23, which included pent-up demand and spillover purchases from a COVID-disrupted Q1FY22.

-Gold jewellery (plain) saw low double-digit growth, whereas studded jewellery sales increased faster than the overall division, owing to strong activation and a higher contribution from high-value purchases.

-The product mix improved over last year but remained below pre-pandemic levels. Walk-ins increased in the low double digits year on year, with consistent buyer conversions.

-New store commissions included eight domestic Tanishq stores, 16 Mia by Tanishq stores, and one Zoya store, bringing the total number of jewelry stores to 606. Rapid fire growth in past few years despite Covid disruption.

Other business performance

The watches and wearables division grew 169% year on year Q1FY23, resulting in the division’s highest quarterly revenue.

Strong demand tailwinds, driven by a desire to own more premium/differentiated watches, aided Titan’s growth in the watches category, which was aided by higher volume and average selling prices year on year.

- The retail store transformation journey, which aims to provide consumers with a broader selection of premium brands in Titan World, Helios, and multi-brand retailers, also contributed to the division’s overall growth.

Titan and Fastrack smartwatches with Bluetooth calling were introduced during the second quarter.

During the quarter, the division added 7 new Titan World stores, 14 Helios stores, and 2 Fastrack stores, bringing the total number of watches and wearables business stores to 905

For the eyewear segment

Double-digit year-on-year sales growth for Titan Eye+ stores was offset by lower year-on-year sales growth across trade and distribution channels, resulting in a 173% year-on-year growth in Q1FY23 for the Eyecare division.

- During Q1FY23, Eyecare expanded its national presence by adding 36 new Titan Eye+ stores and 2 new Fastrack prescription stores (net), bringing the total number of stores in the Eyecare business to 827.

Other segment

-The other segment of Fragrances and Fashion Accessories (F&FA), Indian Dress Wear) remained strong. F&FA increased by 34% year on year, driven by 37% year on year growth in fragrances and 29% year on year growth in fashion accessories.

-Large format stores (LFS) grew the fastest among key offline channels for F&FA, followed by trade, both growing much faster than the overall division.

Taneira (Sarees) increased by 114% year on year, with significant contributions from new stores opened in the last year.

- The brand expanded its reach to 31 stores across 14 cities by entering the cities of Madurai, Hubli, and Dhanbad, as well as deepening its existing city presence by opening 5 new stores during the quarter.

Titan Engineering & Automation Limited (TEAL)

TEAL reported 139% y-o-y growth, with Automation Solutions Division growing by 240% YoY and Aerospace and Defence Division growing by 66% YoY.

- CaratLane (72.3% owned): Caratlane grew 56% year on year, owing to Raksha Bandhan promotions and hero launches during the quarter.

- Solitaires grew the fastest across all categories, followed by studded and gold jewellery.

Despite a larger base than last year, Studded jewelry continued to contribute 70% of the business.

Financial

-FY 22 topline was around INR 28,799 Cr Vs. 21,644 Cr in FY21 therefore up by 33% in YoY. Last 5 years revenue growth is 17% CAGR.

-Q1FY23 topline was around INR 9,443 Cr Vs. 3,473 Cr in YoY up by 199% in YoY. Company exhibited a strong performance in Q1’23 over a Covid disrupted lower base of Q1’22. The 3-year CAGR came in at ~20.1% on the back of growth witnessed in all businesses.

-ROE and ROCE was around 26% and 21% respectively.

-MCAP: 240K Crs, Face Value: 1. Equity capital: 89 Crs

-Promoter holding in the company is around 52.9% which is stable, DIIs hold around 11.7%, FIIs hold around 17%.

Conclusion

Titan despite the topline of 8K Crs still 6% market share at organized market. So ample opportunites to grow at longer term. After Covid also peoples more forwarding to brand level segment.

With the increasing aspirations of Indian’s, increased sales through the e-commerce platform, a shift to branded players.

Indians adore gold more than any other people on the planet.

So even the poorest Indian will try to obtain even the smallest trinket that serves as both jewellery and the safest long-term investment. There are 10 million weddings in India every year, and people spend close to 2-3 lakhs on bridal jewellery.

Diversified business opportunity now Jewellery, watches, eye wear, sarees business as well. Brand includes Tanishq, Caratlane, Titan, Fastrack, helios, Titan Eye+

Long term bet for investment purpose.

Disclaimer: The above view shared are personal in nature. This is not buy/sell recommendation. Always check with your financial advsior to buy/sell the shares or do your own diligence.