Gems & jewellery demand strong in festive season, says Bhaskar Bhat

Titan, the jewellery and watch retailer from the Tata group, has reported an 8.34% rise in consolidated net profit for the quarter ended September 30, 2018, as its total income rose to 27% Rs 4,595.13 crore. Bhaskar Bhat, managing director, Titan, in an interview with Swati Khandelwal of Zee Business spoke about the future growth prospects in gems & jewellery segment, response during the festive season and liquidity crunch in the sector, among others. Edited excerpts: 

Let us know about the trend in the gems & jewellery sector in this quarter and what is your outlook on it?

The second quarter was good in terms of growth for all our brands, especially Tanisk. We grew 15-20% and the market share went up to 29%. I feel the demand trend is here to stay in the festive season that starts in November, which will be followed by the wedding dates. This trend will last till February. 

What kind of response was seen during the festive season? 

The festive season was good for us as we grew by 28-29% between Navratri and Dhanteras. 

There are lending related concerns in the sector. Did the banks ease the lending process for the sector or there was a liquidity crunch?

Banks are still tight for the sector. However, we didn’t face the problem as we don’t borrow, but the heat was felt by the small and medium enterprises, which are struggling. The IL&FS issue has added to the problem. 

How did the studded jewellery business perform in the quarter? What is your outlook on the segment for H2FY19?

There is a growth in jewellery and we have also announced targets or doubling sales in it in the next five years (2019-2023). We want to serve 10 million customers per annum under this five-year goal and we are well on our way. 

What is your outlook on the growth of Tanisk stores and how many new stores will be opened in H2FY19?

It will continue to be strong in the existing stores. In fact, they performed well, even during the dull period of sales. In addition, new stores are also being opened.  

Are you planning to come up with new offerings in the watch segment and what are your plans?

We have launched several products during the festive season such as Titan Octane, Titan Grandmaster and RaGa, which comes with asymmetric designs. It is a constant introduction. We are also introducing smartwatches in Titan and women watches. 

Let’s talk about business. What is your growth view in different segments, like the jewellery, watches and eyewear, in the remaining part of this financial year and the next?

Margins for the watch segment improved 18.7% in the quarter. There is a high fixed cost in the watch segment and any growth above it travels towards the bottom-line in terms of profits. 

Can you let us know about online sales contribution and do you have plans to enhance online presence?

It is very low at present and has an online brand named CaratLane. There is a good growth in watch segment.