Titan Company Limited · NSE:TITAN
Titan — CLSA Conference 2019
40 slides from Titan's conference presentation, Nov 13, 2019
Slide 1: Exchange filing cover letter: CLSA Conference investor presentation
♦ TIT/\N COM P /\NY SEC 62 /2019-20 13th November 2019 The General Manager, DCS - CRD The General Manager, DCS - CRD BSE Limited National Stock Exchange of India Ltd Corporate Relationship Department Exchange Plaza, 1st Floor, New Trading Ring Bandra-Kurla Complex, Rotunda Building, P J Towers Bandr
Slide 2: Investor Presentation – CLSA Conference
Investor Presentation – CLSA Conference 13th Nov., 2019
Slide 3: Slide 3
Slide 4: The Journey so far
The Journey so far 1984 1992 1998 Conceived 1987 Timex JV 1996 2003 2005 2008 2010 PED 2007 2009 Accessories 2011 2013 Perfumes 2016 2017 3
Slide 5: The Last 10 years
Revenue 72% m Watches miewellery = Others The Last 10 years mWaches mlewellery = Others
Slide 6: Jewellery Division – Regulatory environment
Jewellery Division – Regulatory environment Demonetisation External headwinds External tailwinds • Regulatory changes • Demonetization • 80-20 gold import rule • Cash limit of Rs 2 lakhs • EMI on gold jewellery suspended • GST • RBI ban on Gold-on-lease • Banking scams • Impact on GHS scheme 1st Jan
Slide 7: Jewellery Division – Internal initiatives
Jewellery Division – Internal initiatives Demonetisation External headwinds External tailwinds Internal initiatives • 6 major drivers – Wedding jewellery, High value studded, GHS, Gold Exchange, Hero markets, Network expansion 2018 Q4 – Wedding 2015 – Reduction in jewellery brand “RIVAAH” making cha
Slide 8: Jewellery Division – Performance of drivers
Jewellery Division – Performance of drivers Demonetisation FY 15 FY 19 • Wedding contribution: 14% • Wedding contribution: 21% • High value studded contribution: 7% • High value studded contribution: 10% • GHS contribution: 27% (fell to 5% in • GHS contribution: 19% FY 16 after the regulatory change
Slide 9: Jewellery Division – Competitive scenario
Jewellery Division – Competitive scenario Demonetisation • Aggressive store expansion • Credit squeeze • PE funding and easier access to capital • IPOs not launched as yet • Some peers were planning IPO • Slow down in store openings • Middle East imposed 5% VAT • Some mid-size jewellers have gone ba
Slide 10: Jewellery Division – 5 year ambition
Jewellery Division – 5 year ambition Initially planned to grow 2.5x on base of FY’17 revenue. After 20%+ growth in FY’18, further expanded the ambition to grow 2.5x on base of FY’18 revenue, by doubling the market share to 10%. Same store growth targeted is 14-15% to achieve 20%+ CAGR
Slide 11: Jewellery Division – The current year
Jewellery Division – The current year Retail growth at around 22% till mid June Sharp increase in gold prices mid June Decline in revenues from mid June till end July Growth of around 14% between August and September Retail growth for first half year – 12%; However accounted revenue had growth of on
Slide 12: Watches Division – Trends in the recent past
Watches Division – Trends in the recent past Division losing share of wallet and market Recraft of Strategy Growth phase Cost again? 16% Design 15% Smart/wearables 14% Ecommerce 13% 13% 12% 12% 11% 11% 10% 10% 10% 9% 8% 7% 7% 6% 5% 4% 4% 2% 2% 0% FY 13 FY 14 FY 15 FY 16 FY 17 FY 18 FY 19 Revenue Gro
Slide 13: Watches Division – Current position
Watches Division – Current position Recraft strategy working evidenced by top line and margin growth Smart products launched with Titan ‘Juxt’, Sonata Act, Fastrack Reflex (activity tracker bands) Titan becomes number 2 in wearables in Indian market by volume as per IDC Premiumisation journey contin
Slide 14: Eyewear Division – Trends & Way forward
Eyewear Division – Trends & Way forward Low growth phase from FY16 affects Growth with Low growth phase affects Back to high profits profits profits growth? Decision to focus on growth from 30% FY19 - initiatives • Invest in brand building 25% 24% • NPS Score 23% • Right selling 20% • Price-value eq
Slide 15: Fragrances – Progress
Fragrances – Progress Topline has crossed Rs 120 cr (in consumer price) with over a million pieces sold in FY19 SKINN distribution reach has crossed 3300 outlets in the last 3 years. Skinn continues to be the best selling brand in its category in the Large Format Stores for past few years Profitabil
Slide 16: Taneira – Progress
Taneira – Progress Taneira launched in 2017 as ‘special occasion ethnic wear for women’ with opening of 2 stores in Bangalore. Addressable market is INR 40,000 crores Competition - big regional players, but no significant national player. Concept is ‘India under one roof’ with promise of authenticit
Slide 17: New Verticals
New Verticals Accessories have been under the management of Watches division till recently To bring in sharper focus and grow this part of the business rapidly, separate division carved with a Chief Operating Officer in charge Division will handle bags, belts, wallets and fragrances (Skinn) To expan
Slide 18: Design Excellence Centre
Design Excellence Centre Integrated team of 75 Designers, Engineers & Design Researchers Design Innovation Design Philosophy ‘Design that Inspires’ New Business Purpose: Watches Jewellery Eyewear (Perfume) ● Design Leadership across all brands ● Excellence in Design ● Product Innovation ● Leveraging
Slide 19: EDGE
+ © TITAN TITAN COMPANY EDGE reddot design award winner 2013 DESIGN: MAHENORA CHAUHAN TITAN DESIGN STUDIO
Slide 20: EDGE
© TITAN EDGE + TITAN COMPANY Z reddot design award HONORABLE MENTION
Slide 21: reddot award
reddot award Best of the Best Product - Innovative Laser-Cut Tube Jewellery This unique technique combinationof laser cutting with tubing resulted in extremely unique and-differenntted and never seen - before 18k Fine Jewellery.Intricate paterns were created with superior quality and finish and prec
Slide 22: MARITIME
+ © TITAN TITAN COMPANY MARITIME
Slide 23: Deccan Pearl
NEBULA TITAN COMPANY Deccan Pearl Deccan Pearl Ve The pear! is the ultimate gem in defining feminity. Its characteristics of soft mellow exterior exude what the divine ninine is all about. a ifficult for any gemstone to even begin to fit in place of the pearl - the texture, colour, appeal and look a
Slide 24: SPACE-AGE
v fastrack TITAN COMPANY SPACE-AGE
Slide 25: Slide 25
Slide 26: Zoya
+ TITAN COMPANY ZOYA A ‘TATA PRODUCT
Slide 27: Digital transformation - progress
Digital transformation - progress All Brand Sites are Commerce enabled Online Customers – 1.8 Million - 3.5 Million Visitors a month with 14 Million Page views Website have generated around 20K Customer Leads to retail stores Omni Launched in Q2 at Bangalore City Extending Omni to other cities in Q3
Slide 28: Tanishq Rivaah website
€ C fa tanishg.co.in/rivaah x 0 @ BRANDS V CURRENCY SELECTOR V LOGIN ENCIRCLE GOLDENHARVEST 800K ANAPPOINTMENT WISHLIST — CART(o) TANiSHg GOLD DIAMONDS) PLATINUM JEWELLERY COLLECTION RIVAAH AVEER INSIDE TANISHQ = MIA 17] Q RIVAAH BRIDES ¥ JEWELLERY OCCASIONS VY TESTIMONIALS WEDDING TRENDS VY a K TAN
Slide 29: Titan Edge
Titan Edge Product Content on Website
Slide 30: Titan Automatics
Titan Automatics Product Content on Website
Slide 31: People and Talent management
People and Talent management Employee strength exceeds 8000 - around 20% blue collared, around 35% in retail stores 18% females and 2% with disability Significant investment in learning and talent development through well SENIOR MANAGEMENT DEVELOPMENT 5 cross divisional projects undertaken and 4 pro
Slide 32: Subsidiaries
TITAN Subsidiaries
Slide 33: TEAL – Business segments
TEAL – BUSINESS SEGMENTS TEAL provides TURNKEY ASSEMBLY & TESTING SOLUTIONS
Slide 34: TEAL
TEAL TEAL hived off as a subsidiary in 2016 Growth in FY19 and FY20 has been excellent Growth in FY20 for H1 is 33% with EBIT margin of 15% ROCE healthy at over 20% in the current year Order pipeline in Aerospace business very healthy 33
Slide 35: CaratLane
CaratLane India’s Number one born-digital Omni-channel jewellery player Titan acquired 62% stake in August 2016 for Rs 357 cr. Titan’s current shareholding at 72% after primary and secondary stake increase Rapid network expansion - 71 stores at present Significant revenue growth in the last few year
Slide 36: Favre Leuba
Favre Leuba Favre Leuba is the 2nd Oldest Swiss brand with a fascinating, genuine history and legacy. Acquired by Titan in 2012, this brand is on a comeback journey, with commercial launch in 2016 Watches being sold in Switzerland, Japan, Hong Kong, Taiwan, UAE and India Use of Blockchain for warran
Slide 37: Favre Leuba in-house calibres and watches
In house calibres - Automatic movements; functionalities of altimeter, barometer, depth gauge, chrono Raider Bathy 120 MemoDepth, the only watch Two primary design families - capable of measuring and recording depth as Raiders & Chiefs – over 25 SKUs deep as 120m Raider Bivouac 9000, summited Mt. Ev
Slide 38: Sustainability
Sustainability Transforming businesses in the un organized sectors • Watches , Jewellery , Eyewear, Sarees Local Employment opportunities from the under privileged sections of society across manufacturing locations Creating sustainable livelihoods • Women Self Help Groups at Hosur – over past two de
Slide 39: Karigar Centres
Karigar Centres 38
Slide 40: Thank You
Thank You 7 TITAN COMPANY