Titan Puts Up A Good Show, Q4 Net Profit Growth Stands At 12%

The result shows that Titan industries have posted a good set of numbers during this quarter. The margins of the company have also increased but marginally. 

The company has posted a topline of Rs 2786.81 crore during Q4FY14, reporting a growth of around 7.5% on yearly basis. The strong performance of the company's brands during this quarter contributed to increase in sales across all segments like, watches, jewellery and eyewear. The jewellery segment which contributes more than 76% of the total sales has increased by 3% YoY to Rs 2157.33 crore during Q4FY14. Whereas the watches and others segments have surged by 20% and 13% respectively during the quarter ended March 2014 as compared to corresponding quarter of previous year.

The operating profit of the company has reported a jump of more than 11% YoY to Rs 296.58 crore during Q4FY14. Whereas, the net profit of the company has surged by around 12% on yearly basis standing to Rs 206.44 crore for the quarter ended March 2014.  As far as margin is concerned, the operating margin of the company during this quarter has increased marginally by 38 basis points as compared to the corresponding quarter of previous year. The increase in other expenses (up by 16.6%) and administration & selling expense (up by 31%) has dampened the operating margin, resulting in a marginal growth of 38 basis points. The reduction in cost of raw material as proportionate to sales has helped the margins to increase during this quarter. The cost of raw material as compared to sales has reduced by 592 basis points standing to 58.72% during Q4FY14 as compared to the same quarter of previous year.

Commenting on the performance of the company, Managing Director, Bhaskar Bhatt said, “The year 2013-14 was a challenging year given the economic environment that was subdued. The year also witnessed other adverse factors like the regulatory changes that impacted our jewellery business. The company will however continue to invest in strategic initiatives taking into account our long term and sustainable growth plans.”

The company has recommended a dividend of Rs 2.1 per share. The shares of the company yesterday (May 06, 2014) closed at Rs 271.05 per share up by 3.47% from their previous close. Today the scrip of the company is trading at Rs 277.10 a piece. The scrip of the company is trading at a P/E of 33x.