scorecardresearch
Friday, August 2, 2024
Support Our Journalism
HomeIndiaIndia's Tata-owned Titan misses Q1 profit view as high gold prices dampen...

India’s Tata-owned Titan misses Q1 profit view as high gold prices dampen jewellery demand

Follow Us :
Text Size:

BENGALURU (Reuters) -India’s Titan missed first-quarter profit estimates on Friday as higher gold prices hindered demand in its mainstay jewellery segment.

The Tata group-owned company reported a 5% fall in consolidated profit to 7.15 billion rupees ($85.4 million) in the quarter ended June 30, from 7.56 billion rupees an year ago.

Analysts’ on average expected a profit of 7.65 billion rupees, as per LSEG data.

Gold prices have been on the rise since the last financial year, dampening demand for jewellery in India, the world’s second-largest gold consumer, with many retailers offering significant discounts to attract customers.

Additionally, fewer wedding days during the quarter, increasing competition from regional players, and heatwaves across the country have also stifled demand for gold jewellery.

Still, Titan’s jewellery business, which houses brands like Tanishq and CaratLane and accounts for 88% of overall revenue, reported a 10% rise in revenue.

The company said domestic growth for jewellery was largely due to higher selling prices, whereas buyer growth was in the low single-digit percentage range.

Titan’s watches and wearables segment, which contributes 8% to the total revenue, reported a 12% growth in revenue.

While overall sales jumped 13% to 122.23 billion rupees, it grew at its slowest pace in four quarters.

Meanwhile, raw material costs jumped 43% during the quarter due to high bullion prices, hurting margins.

As a result, Titan’s earnings before interest and tax (EBIT) margin contracted to 9.7% from 10% a year ago.

The company’s shares are down nearly 6% so far this year, compared to a 14% gain in the benchmark Nifty 50 index

($1 = 83.7250 Indian rupees)

(Reporting by Ashna Teresa Britto in Bengaluru; Editing by Sonia Cheema)

Disclaimer: This report is auto generated from the Reuters news service. ThePrint holds no responsibilty for its content.

Subscribe to our channels on YouTube, Telegram & WhatsApp

Support Our Journalism

India needs fair, non-hyphenated and questioning journalism, packed with on-ground reporting. ThePrint – with exceptional reporters, columnists and editors – is doing just that.

Sustaining this needs support from wonderful readers like you.

Whether you live in India or overseas, you can take a paid subscription by clicking here.

Support Our Journalism

  • Tags

LEAVE A REPLY

Please enter your comment!
Please enter your name here

Most Popular