Tanishq
Tanishq
12 February 2008
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Disclaimer
Certain statements are included in this release which contain words or phrases such as “will,” “aim,”
“will likely result,” “believe,” “expect,” “will continue,” “anticipate,” “estimate,” “intend,” “plan,”
“contemplate,” “seek to,” “future,” “objective,” “goal,” “project,” “should,” “will pursue” and similar
expressions or variations of these expressions that are “forward-looking statements.” Actual results
may differ materially from those suggested by the forward-looking statements due to certain risks or
uncertainties associated with our expectations with respect to, but not limited to, our ability to
implement our strategy successfully, the market acceptance of and demand for our products, our
growth and expansion, the adequacy of our allowance for credit to franchisees, dealers and
distributors, technological changes, volatility in income, cash flow projections and our exposure to
market and operational risks. By their nature, certain of the market risk disclosures are only
estimates and could be materially different from what may actually occur in the future. As a result,
actual future gains, losses or impact on net income could materially differ from those that have been
estimated.
In addition, other factors that could cause actual results to differ materially from those estimated by
the forward-looking statements contained in this document include, but are not limited to: general
economic and political conditions in India and the other countries which have an impact on our
business activities; inflation, unanticipated turbulence in interest rates, foreign exchange rates, the
prices of raw material including gold and diamonds, or other rates or prices; changes in Indian and
foreign laws and regulations, including tax and accounting regulations; and changes in competition
and the pricing environment in India. The Company may, from time to time make additional written
and oral forward-looking statements, including statements contained in the Company’s filings with
SEBI and the Stock Exchanges and our reports to shareholders. The Company does not undertake
to update any forward-looking statements that may be made from time to time by or on behalf of the
Company, to reflect events or circumstances after the date thereof.
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Titan Industries
A Happening Company in
a Happening India !
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Titan Industries
Pioneer
Breaker of rules
Leader in two businesses:premium and mass market
Manufacturer,designer,brand owner,marketer ,
retailer and after-sales service provider
Unique culture
First company to dare to challenge the Swiss
B2C and B2B player
In four businesses from 2007-08
One of the Jewels of the Tata Group
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Our Heritage – the TATA Group
Titan is a part of the TATA Group having a turnover of about
USD 30 bn, equivalent to over 2.5% of India’s GDP and having the
biggest market capitalization in India
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About Us
Titan is the world’s sixth largest, integrated manufacturer-brand for
watches
Commencing production in 1986-87, the Company is today the
leader in the Watch & Jewellery businesses in India
First & largest player in the branded jewellery segment
(Tanishq)
>60% share of the organised watch market
Over 90 million watches sold across 30 countries, cumulatively
Manufacturing Facilities
Main Watch & Jewellery plants in Hosur near Bangalore
(India’s “Silicon Plateau”)
Watch assembly plants at Dehradun, Baddi, and Roorkee.
ECB plant in Goa; Jewellery Plant at Dehradun
Investment of US$150 million in a 450,000 sq.ft. state-of-the-
art facility
Owned by Tata: 25.17% and TIDCO: 27.88%
Professionally managed by TATA group & an independent Board
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Recognition and Awards in many categories
• The Watch Division won the coveted JRD QV (Malcolm
Baldrige) Award in 2006.
• India’s most admired consumer durables company having
the most trusted brand -TITAN.
• Both TITAN and TANISHQ adjudged most admired brands
for the last 4 years.
• Adjudged Retail Company of the year.
• Retail Asia and Media Award-Singapore, for Retailing and
preferred brands.
• Being selected as “Domestic Dynamo” by BCG (based on
dynamism of the Company; competence of management)
• Ideator Awards for Titan designers.
• Best Corporate Citizen – Mother Teresa, Helen Keller,
Rotary and Chamber of Commerce Awards.
• President of India Award for best employer of the physically
challenged. 7
Eight Indian firms among S&P`s challengers to
global majors
BS Reporter / New Delhi May 11, 2007
Eight Indian firms from industries as diverse as cement, hospitality,
textiles and consumer goods are expected to emerge as challengers
to the world’s leading blue chip companies, according to rating
agency Standard & Poor’s (S&P) annual rating of global challengers
Market Cap
($million)
ACC 4,590.91
Siemens India 4,320.96
Indian Hotels Co. 2,044.46
Lakshmi Machine Works 1,004.50
Titan Industries 861.56
Marico 742.54
Hotel Leela Venture 530.02
Jain Irrigation Systems 505.19
Source: S&P, m-cap as of Dec 31, 2006
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Our businesses
Watches Currently
Marketing
Jewellery our Products in
26 countries
International Business with a larger
footprint in the
Middle East and
Precision Engineering Asia-Pacific
regions
Prescription Eyewear
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Our Brands
TITAN
SONATA
FASTRACK
XYLYS
TANISHQ
GOLD PLUS
TITAN EYE+
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THE THREE YEAR JOURNEY…
INCOME
Watches Jewellery Company
1000 1500 1292 2400 2136
784
800 655 1200 1800 1481
Income in Rs. Cr.
0 0 0
2004-05 2005-06 2006-07 2004-05 2005-06 2006-07 2004-05 2005-06 2006-07
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THE THREE YEAR JOURNEY…
CAPITAL EMPLOYED
in Rs. Cr.
in Rs. Cr. 120 101 400
200
90 300
100 60 200
30 100
0 0 0
2004-05 2005-06 2006-07 2004-05 2005-06 2006-07
2004-05 2006-07 2006-07
Year Year Year
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THE THREE YEAR JOURNEY..
PBT
132
140
120
87
PBT - Rs. Crores
100
80
60 32
40
20
0
2004-05 2005-06 2006-07
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Market Capitalisation (Rs. Cr.)
Market Cap.
5000 4400
4000 3530
3000
2000
1018 Crossed
500 Billion $
1000
218
0
2002-03 2003-04 2004-05 2005-06 2006-07
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2006-07 – a year to remember..
Financials
Company Income crossed Rs 2000 Crore mark
PBT crossed Rs 100 Crore mark
Share price crossed Rs 1000 and Market cap crossed a billion dollars
Brands
Brand Tanishq crossed Rs 1000 Crore mark
Brand Titan crossed Rs 500 Crore mark
Brand Sonata crossed Rs 300 Crore mark
Brand Fastrack crossed Rs 100 Crore mark
Retailing
World of Titan stores crossed 200
Retail space – added over 60,000 sq ft.
Large format Flagship store – Rs 100 Crore in first year
New Businesses
Expansion of Gold Plus and Precision Engineering
Titan Eye + began its journey
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2007-08 PERFORMANCE
FIRST NINE MONTHS
16 16
PERFORMANCE – 2007-08 – FIRST NINE MONTHS
INCOME
500 1532
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PERFORMANCE – 2007-08 – FIRST NINE MONTHS
60
PBT in Rs Cr
PBT in Rs Cr
45 80
45 48
28 60
30 30 40
15 15 20
0 0 0
2005-06 2006-07 2007-08 2005-06 2006-07 2007-08 2005-06 2006-07 2007-08
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PERFORMANCE – 2007-08 – FIRST NINE MONTHS
CAPITAL EMPLOYED (END DECEMBER)
in Rs. Cr.
200 in Rs. Cr.
200
146 400
150 150 300
100 100 200
50 50 100
0 0 0
2005-06 2006-07 2007-08 2005-06 2006-07 2007-08
2005-06 2006-07 2007-08
Year Year Year
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I Watch Business
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The Watch Market & Industry in India
India is an under-penetrated market for watches –
only 27 % of Indians own a watch
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Watch Market Map
Formal / Classic
Omega,Rado,
Longines
Raymond Weil
Tissot
Nebula
Sonata,
HMT, TITAN Citizen
Maxima XYLYS
Price
Rs 500 1000 2000 4000 5000 10000 30,000 +
Timex
Espirit, Swatch Fossil
Giordano, DKNY,
Fastrack Carrera Tag Heuer
Tommy Hilfiger Hugo Boss
C Dior
Fashion/Sporty
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OUR WATCH BUSINESS – OVERVIEW
Consistent growth
* PBT (2004/05) - Rs. 70 Crores
Profits * PBT (2005/06) - Rs. 90 Crores
* PBT (2006/07) - Rs. 96 Crores
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II Jewellery Business
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Jewellery – Market & Industry highlights
•Size of market: Rs 65,000 crores (~ US$ 16 billion)
•Urban market is about 38% of this base
Market •Branded jewellery is less than 5% of the overall market
•Importance of jewellery to Indian consumers –
Gold is seen as auspicious, an investment, for adornment….
•Product mix: largely plain gold 22kt, with gem set
jewellery constituting less than 10% of the market
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TANISHQ TODAY – A BRIEF OVERVIEW
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TANISHQ TODAY – A BRIEF OVERVIEW
Impressive turnaround
• PBT (2004/05) - Rs. 20 crores
• PBT (2005/06) - Rs. 35 crores
Profits • PBT (2006/07) - Rs. 77 crores
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Gold Plus :Size of the opportunity
Semi-urban and rural market estimated to be as much as 50%
of the total : Over Rs 30,000 crs.
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III INTERNATIONAL
OPERATIONS
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INTERNATIONAL BUSINESS
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IV Precision Engineering Business
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Precision Engineering Business
Rationale
Leveraging Engineering capabilities
B2B business – balances risk of B2C businesses
The Opportunity
India growing as a manufacturing base for precision products
across industries
Cost pressures and offset requirements guarantee a long term
opportunity
High cost of switching for customers
Large & growing market: The global market for precision
engineering products addressable by Titan is Rs.135,000 cr.
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Current position: 3 segments 3 streams
Market Size
Rs 135,000 Cr. Automotive Market Size
Rs 575 Cr.
•Precision
components
Automation
•Dash board Aerospace Solutions
instruments
•Sub systems
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THE EYEWEAR MARKET – AN UNTAPPED OPPORTUNITY
Incidence:
30% of population typically needs correction in vision ~ 300 mn
Users: 84mn users – which is about 25% of those who need the correction
Consumers change their glasses / frames once in 3 to 4 years on an average
Market size:
•25-35 million units per annum
•Rs 1500-1800 crs per annum
•Comparable to the watch industry
•Repeat purchase is a regular feature from adolescence to old age.
Customer lifetime value is very high
•Almost everyone over 40 yrs needs correction.
Growth: Market has been growing in double digits ~ 15-20% per annum and
likely to sustain
Demand drivers: Urbanization, literacy, Penetration of TV & computers, Poor
eye health due to lifestyles/ improper diet, etc.
Margins: Overall mark ups of up to 300% exist between landed cost & retail
price!
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OUR BUSINESS PROPOSITION
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WHERE WILL WE PLAY IN THE VALUE CHAIN
OUTSOURCE
Frame and Lens
Design lens blank Wholesale finishing RETAIL,
and manu- distribution and SERVICE
Marketing facturing assembly
Tie up with
Mfg is not yet a
reputed lens
desirable option
brands & labs
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Way Forward
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2007-08
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Rising % of Increase
Demographic Changing
young in Income Spending
Needs Population levels pattern
CONSUMERISATION
Effect
OF URBAN INDIA
Increase in
Number
working
urbans
Increase in Increase in Rising
Enablers Number Spending Aspiration
Of working power levels
women
Organised retail market
Consumption of Lifestyle Items at Rs.97000 Cr by 2010
Outcome (CAGR 31%)
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A Company that endears itself to
Seize the Opportunity !
millions of Indians …
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Organised Retailing –The
Seize the Opportunity !
New Buzz
Our retail network comprising of
101 Tanishq stores
226 World of Titan stores
20 Goldplus stores
14 Sonata stores
117 Timezones and
135 Watch Care Centres
SONATA 14 TO 20
FASTRACK KIOSKS 10 TO 40
TANISHQ 88 TO 106
GOLD PLUS 10 TO 25
TITAN EYE+ 1 TO 12
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So what kind of company?
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By 2009, More than a billion $ company
6000
5000+
5000
4000+
4000 3000+
1000
0
2007 2008 2009 2010
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Multiple Businesses, Brands and Geographies
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THANK YOU
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