Titan Slowsdown on New Store Launches

Titan Industries Ltd has revisited its extensive store roll-out plan across segments in view of lower-than-expected growth in volumes. The company has put on hold the further launch of GoldPlus stores until demand for gold jewelry improves. In 2HFY10, the company plans to open only three large format Tanishq stores unlike the earlier model of multiple smaller stores at different locations.

It has also cut down on its target for the Titan Eye+ stores to 90 by end-FY10 from its earlier target of around 120-130 at the beginning of the year. The company is currently relocating seven of its existing eye-wear stores to smaller locations in order to save on rentals and improve the profitability of these stores.

The recent jump in gold prices (by almost Rs100/gm post Diwali) will likely impact the jewelry demand in the ensuing marriage season thus offsetting any improvement in volumes during Diwali. Gold imports have declined 39% to 27 tons in October.
Expect Titan’s watch segment to benefit from revival in consumer spending and launch of new models

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