Titan’s jewelry business is broadly on track even as steep inflation in gold prices and lockdown dampened full year growth.
Indians Love Jewelry & Royal Wedding
Tanishq wedding jewelry portfolio comprises 16 community assortments under the brand Rivaah. Over the last few, the company has augmented its wedding jewelry range to add traditional and differentiated jewelry designs to suit local preferences in each region (higher localization). Further, it has tweaked pricing to narrow pricing gap with regional competition (competitive making charges for undifferentiated products and premium in case of differentiated designs not available with local jewelers). Lastly, Titan has created a separate section (floor) in large stores for wedding range, backed it by apt decor/ visuals and trained front-end staff to cater to wedding customers. Tanishq stores have become a prominent player in wedding segment in select markets such as Delhi-NCR, UP, Bihar and Maharashtra. It, still, has a long way to go in Southern states partly due to strong incumbent players.
Taniera is Titan’s premium Indian ethnic wear for women. The company opened 8 new stores taking total store count to 12 stores with aggregate retail space of 40,000 sq. ft. across five cities (Bengaluru, Delhi, Mumbai, Hyderabad and Pune). Saree accounted for about 90% of topline and bridal/wedding segment accounted for 30% of topline. In India, sarees account for about 40% of women’s ethnic wear (and it is growing at 5-6% CAGR). Organized players have 15-20% share in sarees, and weddings account for about 40% of the business. The addressable market for Taneira is about Rs400 bn. Akin jewelry, this segment is also fragmented with significant formalization potential.
Zoya and Mia continue to strengthen its positioning in their respective segments. Mia offers trendy designs at affordable price points and targets young, aspirational women. Whereas Zoya is luxury brand positioned in high-value jewelry segment. Zoya added a store taking total count to 4 whereas Mia added 8 stores taking total count to 38.
Titan Gold Exchange & Harvest Schemes
Gold exchange program garnered significant traction during the year partly aided by sharp increase in gold prices and full value offered during select activation / schemes. Gold exchange as % of total gold procurement was about 40-42%
in FY2020. Gold Harvest Scheme continued to help Titan gain wallet share as it comprised about 21% of sales and GHS deposits are nearing ceiling from regulatory standpoint.
Caratlane, Titan’s omni-channel jewelry brand offering modern / everyday designs, grew 49% yoy to Rs6.2 bn in FY2020. Caratlane added 37 stores taking the total count to 92 stores. During the year, Titan acquired 2.8% stake from minority investors for Rs310 mn, valuing the Caratlane at Rs11 bn. Following this transaction, Titan’s stake in Caratlane increased to 72.3%.
In most of these segments, Titan’s outperformance over industry led by market share gains continues.