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Informist, Thursday, Aug. 7, 2025

 

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--Titan: Co's understanding is it sustained mkt shr in jewellery segment Q1
--CONTEXT: Titan Co. managment's comments in post-earnings investor call
--Titan: Have not cut investments in growth to fund margins
--Titan: Lower carats being accepted in jewellery mkt amid high gold prices
--Titan: See watches segment margin around 15% in next two quarters

 

By Rajesh Gajra

 

NEW DELHI – Given the current significant uncertainties due to external factors and the consequent impact on gold prices, it is difficult to predict the growth trajectory in the jewellery segment in the remaining three quarters of the financial year 2025-26 (Apr-Mar), the management of Titan Co. Ltd. said in a post-earnings call with investors Thursday. The September quarter will see the effect of a higher base in the year-ago quarter, it added.

 

Despite similar conditions in the June quarter, Titan reported 19% on-year rise in the jewellery segment's revenue for the quarter to INR 127.97 billion in its consolidated accounts. On a standalone basis, the jewellery segment revenue increased 17% on year to INR 115.21 billion.

 

To a question on Titan's market share in jewellery in the light of lagging sales growth momentum in the last few quarters, the management said the company is of the understanding that it has sustained its market share in the June quarter. It came to this understanding after triangulating various data points such as market data, World Gold Council data, and internal numbers, it said. The management further said the competitive landscape was not just two or three players fighting for market share, and there are at least seven or eight large national players, 8-10 large regional chains, and a host of regional players. Amid high gold prices, the company has experimented with lower caratage gold jewellery and seen good response from customers, it added.

 

In studded diamonds, Titan witnessed consumption-related challenges in the June quarter, the management said. To a question on whether the laboratory-grown diamonds market was having an adverse impact on Titan's diamond sales, the management said "the new studded buyers are still preferring the natural". Customers are also not comfortable migrating to laboratory-grown diamonds because they are not sure whether it will hold value and if it is a real thing, the management said.

 

To a question about the impact of the US tariff situation on Titan's international business and supply chains, the management said the "current signals are quite volatile" but since the share of sales in the US is only around 2% it is not a "deal breaker for us". Titan will not approach the situation in a knee-jerk fashion and will "just wait it out", it added.

 

In the watches segment, Titan reported strong revenue growth of 24% on year in the June quarter and a jump of 2.6 times in earnings before interest and tax. The EBIT margin expanded substantially to 22.6% from 10.9% a year ago. The management said it sees the margin in this segment normalising to around 15% in the next two quarters. Titan also reported an increase in the EBIT margin of the jewellery segment to 11% from 10.3%.

 

The management clarified, in response to an analyst's question, that the good margin performance in the June quarter does not mean the company was compromising on growth. "We have not really gone out there and cut our investments in growth to kind of fund margin," it said. Titan has not held back on retail expansion and on increasing the footprint of existing stores, and continues to invest in marketing "as much as it is needed", the management said.

 

Titan announced its June quarter earnings Thursday. The consolidated net profit of the company jumped 53% on year to INR 10.91 billion on the back of a 25% rise in consolidated total revenue to INR 165.23 billion. Thursday, shares of Titan closed flat at INR 3,415.70 on the National Stock Exchange.  End

 

Edited by Rajeev Pai

 

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