Titan Company is expecting to be benefited from the credit squeeze faced by other jewellers, said S Subramaniam, CFO of the company, adding that the the current situation restrains other firms from expanding.
“Market share gains are visible. We are seeing a lot of jewellers under the credit squeeze at this point in time and therefore that inhibits their ability to expand, put in more inventory, buy inventory and so on and so forth. We do hear delays in payments to vendors as a normal phenomenon these days. So it is clear that the credit squeeze is impairing their efforts to build their sales. That is where Titan is far better positioned because of the strength of our balance sheet,” said Subramaniam.
The company also seems to be betting big on the wedding season. “After the rupee has strengthened, after that period of weakness, it is in the ballpark of 70 per dollar, gold rates are attractive and clearly we are seeing a revival and spending after the Diwali season as well. That is the good news. Wedding season is a strong one. So I think it is helping people like us quite considerably,” he said.
“Typically in a wedding jewellery season, plain gold jewellery does much better but what is heartening is that our studded targets have also been met. That is a good sign. Overall looks pretty good,” he added.
Elaborating on the business growth, he said, “We have been saying that if we were to achieve our target of 2.5 times of our revenue of last year, we should be close to 10 percent market share over the next five years. The assumption here is that the market may grow at around 5-7 percent and we would be growing at a compounded annual growth rate (CAGR) of around 20 percent.