Jeweller and watchmaker Titan Ltd reported a 25% drop in net profit to ₹705 crore for the quarter ending September 30, 2024, impacted by inventory losses due to a reduction in customs duty on gold imports. This was down from ₹940 crore in the same period last year.
Total income rose by 24% to ₹12,458 crore in Q2FY25 compared to ₹10,027 crore in Q2FY24, with a surge in consumer demand for plain gold jewellery following the cut in import duty from 15% to 6%. Despite this growth, Titan’s jewellery segment faced margin pressures, leading management to reduce EBITDA margin guidance.
The jewellery segment’s income rose 26% year-over-year to ₹10,763 crore, with EBIT at ₹932 crore, yielding an 8.7% margin. Adjusted for customs duty impact, EBIT stood at ₹1,222 crore with an 11.4% margin. However, the profitability of Q2 was depressed due to customs duty losses of around ₹290 crore and investments in various business growth initiatives.
Managing Director CK Venkataraman expressed optimism about the company’s performance for the rest of the fiscal year, citing strong growth across jewellery, watches, and wearables segments. Titan’s smaller watches and wearables division saw a 19% revenue increase, fueled by demand for analog watches.
As of 9:34 am, Titan shares were trading 3.10% lower at ₹3,130.25 on the NSE.
Disclaimer: The information provided is for informational purposes only and should not be considered financial or investment advice.
