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Titan Co. Maintains Strong Growth As Market Cap Crosses $14.5B

The Tata industrial group-owned Titan Company, which has a strong jewellery retail presence across India mainly through its Tanishq jewellery brand, has now exceeded ₹1 trillion ($14.5 billion) in market capitalisation. The company also majority owns CaratLane, the online jewellery brand that is now expanding in the brick-and-mortar segment as well.

Titan, which also owns the eponymous watch brand, recorded a 41.6 percent earnings growth in the third quarter of fiscal 2019 (October-December 2018), reporting net profits of ₹416 crore ($60.12 million).

The overall performance was impelled by a strong showing in its jewellery business, which registered a 37 percent sales growth — due mainly to consumers buying heavier jewellery with 20 percent more gold.

The heavier jewellery is usually associated with the bridal market and analysts say that an increased number of auspicious dates for Hindu weddings in the January to June 2019 period, will see a further acceleration in the company’s jewellery sales.

The analysts add that Titan will continue to benefit from the shift in Indian jewellery demand from the traditional unorganised sector that consists of neighbourhood or “family jewellers” to the organised and branded segments. The shift began after the country’s demonetisation of ₹500 and ₹1,000 notes and gained momentum with the implementation of the Goods & Services Tax (GST).

Rating agency ICRA thinks Titan will continue to increase its margins and see  steady sales growth due to the strength of its brand and growing demand. ICRA also said that the outlook for the company is bolstered by its high and consistent profitability, strong liquidity and zero debt.

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