BENGALURU (Reuters) -Indian jeweller and watch maker Titan Company on Friday reported a bigger-than-expected second-quarter profit, aided by the strong sales of its Tanishq gold jewellery.
Titan, a joint venture between the Tata Group and Tamilnadu Industrial Development Corp, said its profit for the second quarter ended Sept. 30 was up 9.7% at 9.40 billion rupees ($113 million), beating analysts’ average expectation of 8.47 billion rupees per LSEG data.
The company, which also houses eyewear and watch brands like Fastrack, Police and Tommy Hilfiger, said the sale of products surged about 22% to 99.03 billion rupees, as its partners stocked up in anticipation of a significant festive demand this quarter, Titan said in its quarterly update early last month.
A slew of new launches, healthy wedding season and high-value studded purchases drove Titan’s revenue growth, the company said.
Tanishq saw double-digit growth each in the number of buyers and average bill value per buyer, bolstering the revenue growth.
Gold prices stretched to a record high of 61,845 rupees per 10 grams this year in India, pushing the jeweller’s cost of raw materials up by 42% during the quarter. Jewellery accounts for about 88% of the company’s revenue.
During the quarter, Titan raised stake in its subsidiary CaratLane Trading, taking its total shareholding in the unit to 98.28%.
Titan had, in its quarterly update, said CaratLane’s sales grew 45% from a year ago. The deal with CaratLane will raise Titan’s share in the fast-growing affordable jewellery category, analysts said.
Meanwhile, the watches and wearables segment posted an almost 32% jump in revenue.
Shares of Titan were up 2.3% post the earnings.
($1 = 83.2525 Indian rupees)
(Reporting by Ashna Teresa Britto in Bengaluru; Editing by Dhanya Ann Thoppil)