Tata group firm Titan on Wednesday said its jewellery division has recovered from the COVID-19 pandemic jolt, entering the growth phase, and other divisions have moved closer to full recovery led by festive season sales in the third quarter of the current fiscal.
The company had reported an unprecedented net loss of Rs 297 crore in the April-June quarter due to the pandemic. Its standalone net profit declined 37.81 percent to Rs 199 crore for the quarter ended September 30, 2020 as against a net profit of Rs 320 crore in the corresponding period of the preceding fiscal.
"The company had been expecting a good festive season given the fact that there were signs that customers wanted to feel good by stepping out and shopping after 6 months of being restricted primarily to their homes.
“Q3 did not disappoint. The jewellery division has crossed the recovery phase to growth phase and other two large divisions have also moved much closer to the full recovery," Titan said in its quarterly update.
Titan said the company continues to focus on the creation of a combined digital and physical experience by which the customers can discover, engage, and buy products of their choice through the channel of their preference. Brand websites of Tanishq and Titan Eye Plus have added augmented reality for virtual try-out of certain products by customers.
Titan said its arm Titan Commodity Trading has received approval of admission of membership as a trading member (stock broker) on Multi Commodity Exchange of India (MCX) along with SEBI approval for the same.
"The company is setting up its processes and is expected to commence its activities in the very near future," the company said.
Elaborating on jewellery business, Titan said: "The jewellery industry saw a resurgence in the festive season along with a pent up demand for wedding jewellery as most of the weddings in the first half of year 2020-21 were deferred.
“The company already announced the 15 percent growth in the 30-day festive period from Dussehra to Diwali. Fortunately, the growth trend was visible even after the festive season ended and the division has recorded close to 15 percent growth (excluding sale of raw gold of Rs 334 crore) in Q3.”
Titan said, while ticket size continues to be higher due to higher gold rates and higher share of wedding related products, 100 percent recovery in buyers (number of invoices) is yet to be seen.
Titan's watches and wearables division had a recovery rate of around 88 percent in Q3, compared to the revenue of the same quarter in last year.
"The e-commerce channel is leading the recovery with very strong absolute growth of over 30 percent. The festive period saw a surge in footfall in the shopping zones and the recovery rate improved in metros in Q3.”
The recovery rate for all the retail channels had been steadily increasing month-on-month primarily due to higher consumer walk-ins and also complemented by the selling of multiple products/ higher ticket size product in a single invoice, it said.
Titan said its other businesses had a revenue recovery of around 80 percent, compared to the revenue of the same quarter in last year.
The company’s eyeware division had a recovery of 92 percent in Q3, compared to the revenue of the same quarter in last year.
The recovery rate for fragrances and accessories continued to be muted due to the slow recovery of two of the biggest channels, trade and large format stores (LFS), the company added.
Titan said Caratlane, which is 72.3 percent owned by the company, delivered a growth of 39 percent for the quarter and the growth turned positive on a cumulative basis for the year.