Titan eyes 20% sales growth in FY13, says MD

In an interview with CNBC-TV18, Bhaskar Bhat, MD of Titan said consumer sentiment has been weak and jewellery segment has been down because of fewer wedding dates and a weakening rupee. Moreover, walk-ins at stores were also poor. As investment in gold is losing its sheen, the company has launched new products and schemes for diamond jewellery, informed Bhat adding that the diamond jewellery segment has grown by 22%.

However, Bhat is not very optimistic about margin improvement and feels it is unlikely for profit to grow faster than topline. Titan expects FY13 sales growth at 20%.

Here is the edited transcript of the interview on CNBC-TV18.

Q: You have indicated that a 30% revenue growth which you have seen in the past three years looks difficult for FY13. Could you provide us with a realistic guidance of what your revenue will look like? Will it be close to about 20% for FY13?

A: We do not provide guidance in the manner in which software companies do. These are just targets that we had set for ourselves, which is a 30% growth. That certainly doesn't seem realistic anymore because of the market sentiment. We would be happy if we achieved a 20% top-line growth.

Q: The sales in the current quarter itself have been a little under the weather at about 9.2%. What were the highlights of this quarter?

A: 9.2% is the highlight because it's way below our normal performance. Sentiment has been weak, however the watch division grew 14% plus in top-line. I think the surprise on the negative side really was jewellery. It was driven by many factors. One is the wedding days as we have mentioned.

But weak consumer sentiment is also because of general inflation. Consumers are not going so easily for conspicuous consumption items like watches, jewellery and the worry about the weakening rupee also remains. Overall, we are seeing across the board, except perhaps in FMCG brands and products there is a weak consumer sentiment.

Walk-ins are poor. It is not doomsday scenario. It is just that people are cautious and very, very careful with their money.