In an update on its performance in Q3 FY 16-17, Titan Company said that the period represented “a mixed bag” of sorts. 

“The    Company had one of its best festive seasons in the last few years with both Tanishq and Watches performing well above expectations,” the Company said hailing the much awaited turnaround and resurgence in consumer sentiments.

However, post the demonetisation announcement by the Prime Minister on November 8, 2016, “all consumer facing businesses of the Company witnessed a drastic slow down for a few days after which recovery was clearly visible in modern retail and dedicated retail channels”.

Titan said that the sale in these channels “has recovered to pre-demonetisation levels”; however, the sale in the trade channel in Watches (the multi brand outlets) “has taken a hit and is yet to recover as most transactions in these outlets have been on cash basis”.

The Company announced that it is in the process of introducing various modes of electronic payment in all its stores, for the convenience of its customers.   

Titan’s jewellery brand Tanishq’s like-to-like sales increased by 40% over the 30 days of the festival period. This was a result of the new collection launches; as well as various consumer schemes and an attractive exchange programme introduced by the Company for the festive season.

Immediately after the November 8th announcement, several Tanishq stores “experienced a huge rush of buyers and sales for the day were abnormally high”, the Company reported.

“The Company had directed all store staff to adhere to all applicable regulations and ensured all stores closed sales at midnight,” Titan stressed.

After a brief lull post-demonetisation, the Company said Tanishq's average daily sales were restored at a level “close to the average daily sales pre-demonetisation”.

“This trend was visible till the end of December and is possibly due to a strong wedding season and closure of a number of smaller jewellers across the country,” Titan indicated. “Almost all our sales now are either from the GHS scheme, (advances paid by customers for custom made jewellery before the demonetisation) or from electronic modes of payment. GHS enrolments and redemptions are also on track and the Company is providing multiple payment options to its GHS customers for payment of instalments.”

Despite the challenges due to internal and external factors, the jewellery division’s revenues have shown a good growth. Titan said that retail growth for Tanishq in Q3 FY 17 is around 15%.

In this quarter, the division also added four Tanishq stores totaling 12,000 sq. feet retail space.

After the festival high and post-demonetisation lull, the Watches division has recorded a high single digit growth. However, the Company said “the trade channel is expected to take another 2-3 more months to recover”. The trade channel contributes to around 50% of the sales of this division.