Titan Q2 Results: Net profit falls 23% YoY to Rs 704 crore on customs duty cut

Tata Group-owned lifestyle products retailer Titan on Tuesday reported that its consolidated profit for the quarter ended September 2024 fell 23.1% to Rs 704 crore year-on-year (YoY) mainly due to impact of customs duty reduction.

During the quarter, Titan's total income rose 26% YoY to Rs 13,660 crore.

The profit figure was lower than Street estimates of Rs 900 crore as reflected in a poll by ET Now while the revenue was higher than estimates of Rs 12,350 crore.

Titan's mainstay jewellery business saw its total income for the quarter growing 26% over Q2FY24 to Rs 10,763 crore. Its EBIT of Rs 932 crore in the jewellery segment came at a margin of 8.7% for the quarter. Normalising the custom duty impact, Q2FY25 EBIT came at Rs 1,222 crore, clocking 11.4% margin.

"The customs duty reduction saw a revival in consumer interest as gold prices cooled off temporarily. The ensuing gold rush lasted well into mid-September. Buyer growth was healthy and well accompanied by increase in average selling prices, both exhibiting double-digit growths," Titan said in a filing.

During the quarter, in India, Tanishq opened 11 new stores, Mia added 12 and Zoya added 1 store respectively.

"After a muted Ql, Q2 witnessed encouraging growth across key businesses. Jewellery clocked healthy double-digit growth for the quarter. Our portfolio approach in this business of straddling diverse customer needs through the brands of Tanishq, Mia, Zoya and Caratlane is working well," said Titan MD CK Venkataraman.

He said the buyer growth metrics were fairly strong and in good double-digits across gold and studded product categories.

"On account of the customs duty-related losses, as well as the need to invest in growth of various businesses, the profitability of Q2 was quite depressed. However, we are quite confident about the competitiveness of each of our businesses and we remain optimistic about our performance for rest of the financial year," Venkataraman said.

Titan's watches and wearables business saw 19% growth during the quarter. The wearables segment saw a 13% drop in their revenue compared to Q2FY24 primarily due to reduction in average selling prices.

The eyecare business grew 7% while the emerging businesses comprising Indian dress wear ('Taneira'), fragrances, fashion accessories recorded a total income of Rs 106 crore for Q2FY25 growing 14% over Q2FY24.

The emerging businesses unit together recorded a loss of Rs 29 crore for the quarter.

Titan's international jewellery business recorded an income growth of 62% to Rs 273 crore compared to Q2FY24. During the quarter, Mia opened a new store in Abu Dhabi. The Jewellery international footprint stands at 18 stores consisting of 16 Tanishq stores and 2 Mia stores.

Ahead of the announcement of the Q2 results, Titan shares ended little changed at Rs 3,233 on BSE on Tuesday.