We are seeing very good growth rates in all businesses: Bhaskar Bhat, MD, Titan

Bhaskar Bhat, Managing Director, Titan, in an interview with Swati Khandelwal, Zee Business, talks about future prospects of growth in gems and jewellery segment, response during the festive season and liquidity crunch for the sector among others. Edited excerpts: 

Q: Let us know about the trend in the gems and jewellery sector in this quarter and what is your outlook on it?
A: The second quarter was good in terms of growth for all our brands especially for Tanishq. We grew by 15-20 per cent in the market and the market share went up by 29 per cent. I feel, the demand trend is here to stay in the festive season that starts in November, which will be followed by the wedding dates. This trend will last till February. 

Q: Can you tell something about the kind of response that was seen in this festive season? 
A: The festive season was good for us as we grew by 28-29 per cent between Navratri and Dhanteras. 

Q: There are concerns related to lending for the sector. Did the banks ease the lending process for the sector or there was a liquidity crunch?
A: Banks are still tight for the sector. However, we didn’t face the problem as we don’t borrow but the heat was felt by the SMEs who are struggling. The IL&FS issue has added to the problem. 
 
Q: Let’s talk about the studded jewellery. How did it perform in the quarter? What is your outlook on the segment for H2FY19?

A: There is a growth in jewellery and we have also announced targets or doubling sales in it in the next five years (2019-2023). We want to serve 10 million customers per annum under this five-year goal and we are well on our way. 

Q: What is your outlook on the growth of Tanishq stores and how many new stores will be opened in H2FY19?
A: It will continue to be strong in the existing stores. In fact, they performed well even during the dull period of sales. In addition, new stores are also being opened.  

Q: Are you planning to come up with new offerings in the watch segment and what are your plans to face the competition?
A: We have launched several products during the festive season like Titan Octane, Titan Grandmaster and RaGa, which comes with asymmetric designs. It is a constant introduction. We are also introducing smartwatches in Titan and women watches. 

Q: Let’s talk about business. What is your growth view in different segments, like the jewellery, watches and eyewear, in the remaining part of the financial year (FY) and the next FY?
A: Margins for the watches segment has improved by 18.7 per cent in the quarter and growth was led by the growth. There is a high fixed cost in the watch segment and any growth above it travels towards the bottom-line in terms of profits. 

Q: Can you let us know about online sales contribution and do you have plans to enhance online presence, if yes, let us know about the brick and mortar split between the two?
A: It is very low at present and has an online brand named CaratLane. There is a good growth in watches segment as it contributes 10 per cent in terms of sales.