Titan Company had a dismal Q1FY21. The complete lockdown and the saga of the pandemic impacted the earnings. On a 62% (YoY) drop in total income, the company posted a net loss of Rs.270 crore v/s net profit of Rs.371 crore. Lockdown led to zero sales in the month of April, a month which should have seen very high sales normally due to ‘Akshaya Tritiya’ festival.
The company reduced its expenses by 17%, with advertising coming down 88%, employee cost by 10% and despite a tax credit of Rs.65 crore, the quarter ended in the deep red. The Jewellery division sold gold in the bullion market worth Rs.601 crore at market rates to optimize the inventory levels that were built-up in March for the upcoming ‘Akshaya Tritiya’ festival.
Segment wise, jewellery unit revenue was down 71%, watches by 90%, eyewear by 80% and other business, which included Fragrances, Indian dress wear and accessories, revenue was down 88%.
The stock opened itself over 3% lower at Rs.1073 and went down 5% to Rs,1050; it is currently the top loser on the BSE.